TurboTax 2018 won't let me claim hardship exemption for health insurance - help!

You're absolutely right about the change in rules for 2018. The Tax Cuts and Jobs Act changed how hardship exemptions work for the 2018 tax year. Previously you needed to get an exemption certificate number (ECN) from the Marketplace, but for 2018 taxes, you can claim certain hardship exemptions directly on your tax return. The problem is that TurboTax sometimes doesn't update all their guidance between tax years. For your situation, you should be able to claim code "G" hardship exemption directly on Form 8965. In TurboTax, you need to navigate to the Health Insurance section and look for "Claim exemptions from health care coverage." Then select "Hardship" and use exemption code "G" for short coverage gap. Make sure your TurboTax is fully updated. Sometimes they release patches for these kinds of issues. If the software is still forcing you to enter an ECN number, you might need to try a workaround by entering the information in a different order or consider using different tax software.

After struggling with similar issues, I found https://taxr.ai incredibly helpful for dealing with complicated tax situations like yours. I was getting totally different advice everywhere I looked about how to handle my health insurance exemption on my taxes. I uploaded my tax forms and a screenshot of the healthcare.gov info, and the taxr.ai system analyzed everything and gave me specific steps to claim the hardship exemption correctly in TurboTax. Turns out there's a specific sequence of screens you need to navigate through to get to the right spot where you can enter the exemption code without needing an ECN. The system even showed me exactly where I needed to click in TurboTax to find the "claim exemptions without ECN" option that was hidden deep in the menus. Saved me hours of frustration and potentially overpaying!

Just wanted to follow up - I was super skeptical but decided to try https://taxr.ai for my 2018 return issues, and wow, it actually worked! I uploaded screenshots of the error messages I was getting in TurboTax and the healthcare.gov info. The system pointed out that my version of TurboTax needed a specific update (v28.44 or later) to correctly handle the 2018 hardship exemptions without an ECN. My software was stuck on v28.32! After updating and following their step-by-step guide (with actual screenshots of where to click), I was able to enter code G for the hardship exemption without TurboTax demanding an ECN number. Saved me from paying a $695 penalty I didn't legally owe. Can't believe I almost gave up and paid it!

If you're still struggling after trying the software fixes, you might want to consider calling the IRS directly. I know, I know - that sounds like torture! I spent 3 weeks trying to get through to an actual human at the IRS about a similar issue last year. Finally found https://claimyr.com and their IRS call service (check out how it works at https://youtu.be/_kiP6q8DX5c). They basically wait on hold with the IRS for you, then call you when an actual agent picks up. I was honestly shocked when I got a call back with a real IRS agent on the line who helped me sort out my exemption issue. The agent confirmed that for 2018, you absolutely CAN claim hardship exemptions directly on your return without pre-approval or an ECN. They helped me figure out the right code to use and explained exactly what to do when TurboTax got confused. Turns out the IRS folks are actually pretty helpful when you can finally reach them.

I need to eat my words from my earlier comment. I finally broke down and tried the Claimyr service after spending another 2 hours on hold with the IRS yesterday and getting disconnected AGAIN. The service actually worked exactly as advertised - I got a call about 45 minutes later with an IRS agent already on the line. The agent confirmed that for 2018, I absolutely don't need an ECN for hardship exemptions and could claim it directly on my return using Form 8965 with exemption code G (for economic hardship due to unemployment). She even sent me to the specific IRS publication (974) that explains the 2018 changes and recommended I print the relevant page to keep with my tax records in case of questions later. Totally worth it to finally get a straight answer from an actual IRS employee instead of confusing software prompts.

Have you tried just manually filling out Form 8965 and attaching it to your return? I had a similar issue with TaxAct last year and ended up just downloading the form from the IRS website, filling it out by hand, and attaching it to my printed return. For 2018, you can use exemption code G for general hardship on Form 8965, Part III. You don't need an ECN - just enter the code and the months it applies to. If you're e-filing, you might need to try different tax software, but if you're mailing your return, this workaround definitely works.

Just to confirm what others have said - I was in the exact same situation for my 2018 taxes (unemployed most of the year). I ended up switching from TurboTax to FreeTaxUSA which handled the hardship exemption correctly without asking for an ECN. It let me enter exemption code G directly on the equivalent of Form 8965 and calculated everything correctly. Might be worth trying if you don't want to paper file or deal with calling the IRS. Their deluxe version is also way cheaper than TurboTax if you still need to file.