If you’ve purchased health coverage through the Marketplace, you may be able to receive a tax credit, or subsidy, which can lower your monthly premium. To find out if you are eligible, you must answer a few simple questions. Eligibility is based on your family size and family income. If your annual income is below 400% of the federal poverty level (FPL), you may be eligible to receive a tax credit to help lower the cost of health coverage.
What are my options?
Here is a breakdown of premium tax credit options that may be available if you qualify:
- Premium Tax Credit (PTC): A PTC is a refundable credit that can be claimed on your tax return to assist with out-of-pocket expense towards insurance premiums. The PTC is based on a sliding scale. The higher your income, the lower the credit to help cover the cost of health insurance. You can only receive this credit if you have purchased through the Marketplace.
- Advanced Premium Tax Credit (APTC): The APTC reduces what you pay to your insurer in advance. If your annual income exceeds 400% of the FPL, you will have to return the total amount of the credits received.
When do I report a life change?
If you have any life-changing events such as divorce, birth, new job, etc., make sure you report your change immediately. This could save you from paying back the IRS. This could also mean a higher tax credit for you to save on your health coverage. You can report these changes by logging into your Marketplace account or by calling the Marketplace.