Learn How Premium Tax Credits May Help You Save
How Can I Receive A Premium Tax Credit?
When you enroll in a Marketplace Health Insurance plan, you may have the opportunity to save on your monthly premium with a premium tax credit. A premium tax credit helps eligible individuals and families afford health insurance purchased through the Health Insurance Marketplace. The federal government operates the Health Insurance Marketplace for most states. Some states run their own Marketplaces.
Premium tax credits are based on your earnings and family size (including yourself, your spouse, if married, and anyone you will claim as a tax dependent — even if they do not need coverage). If you qualify, you may be able to lower or completely eliminate your monthly premium.
How Does A Premium Tax Credit Work?
The amount of your premium tax credit depends on the estimated household income that you put on your Marketplace application. Those who have a lower income typically get a larger credit to help cover the cost of their health insurance.
When you enroll in Marketplace insurance, the Marketplace determines an estimated credit that is paid to your insurance provider to lower your monthly premiums.
Who Is Eligible For A Premium Tax Credit?
Eligibility depends on your income level and household size. If your income or the number of members in your household changes, so will your premium tax credit. That's why it's important to report income and household changes to the Marketplace as soon as possible.
Do I Have To Pay Back The Premium Tax Credit?
If you've taken more premium tax credit in advance at the end of the year than you're due based on your final income, you'll have to pay back the excess when you file your federal tax return. If you've taken less than you qualify for, you'll receive the difference.
What Other Ways Can I Save Besides A Premium Tax Credit?
You may also qualify for cost-sharing reductions. Cost-sharing reductions are based on your income level and help with out-of-pocket costs like deductibles, copays, and coinsurance. Cost-sharing reductions are only available with a Silver plan.
What If My Income Is Too High For A Premium Tax Credit?
You can still use the Marketplace to buy a health plan without a premium tax credit.
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