What Is The Income Limit For Health Insurance Subsidy 2019? (Correct answer)

Income Limits for 2019 Health Insurance Subsidy

# People in Your Household 1 2
You may qualify for a 2019 premium subsidy if your yearly income is between …. $17,237 -$48,560 $23,337 – $65,840
You may qualify for a premium subsidy AND a cost share reduction if your yearly income is between… $17,237 -$30,350 $23,337 – $41,150
  • What is the income limit for ACA subsidies 2019? Analysis Of Income Limits For Subsidies * Phaseout levels: After earning an income of $100,400 or higher for a family of four, $83,120 for a family of three, $65,840 for a married couple with no kids, and $48,560 for single individuals, you will no longer receive government health care subsidies.

What is the income threshold for health insurance subsidy?

According to Covered California income guidelines and salary restrictions, if an individual makes less than $47,520 per year or if a family of four earns wages less than $97,200 per year, then they qualify for government assistance based on their income.

What is the income limit for ACA subsidies 2020?

In general, you may be eligible for tax credits to lower your premium if you are single and your annual 2020 income is between $12,490 to $49,960 or if your household income is between $21,330 to $85,320 for a family of three (the lower income limits are higher in states that expanded Medicaid).

What are the income limits for premium tax credit 2022?

The minimum income that an individual can have to qualify for the premium tax credit is at least $12,880 in 2022, while for a family of four the mean income has to be at least $26,500 in 2022.

Is marketplace insurance based on income?

Marketplace savings are based on income for all household members, not just the ones who need insurance. Report income and household changes on your Marketplace insurance application as soon as possible. If you don’t, you could wind up with the wrong amount of savings or even the wrong insurance plan.

Do I qualify for the Affordable Care Act?

Individuals at all income levels can sign up for health insurance under Obamacare. If you have a household income between 100% and 400% of the federal poverty level (FPL), you may qualify for a premium tax credit or special subsidies that will reduce health insurance costs.

Who is eligible for health insurance premium tax credit?

In general, individuals and families may be eligible for the premium tax credit if their household income for the year is at least 100 percent but no more than 400 percent of the federal poverty line for their family size.

How do I qualify for health insurance tax credit?

To be eligible for the premium tax credit, your household income must be at least 100 – but no more than 400 – percent of the federal poverty line for your family size, although there are two exceptions for individuals with household income below 100 percent of the applicable federal poverty line.

Does Social Security count as income for Obamacare?

Non-taxable Social Security benefits are counted as income for the Affordable Care Act and affect tax credits. This means that when calculating your eligibility for a subsidy your social security income is used to determine your eligibility and may affect the amount you qualify for. 6

2019 Health Insurance Subsidy – Am I Eligible?

According to the IRS, if your total family income falls between specified criteria, you may be eligible for a health insurance subsidy in 2019. The income cutoffs are connected to the Federal Poverty Level and are updated on an annual basis to account for inflation.

Income Limits for 2019 Health Insurance Subsidy

The income data for 2019 are shown in the chart below. To make use of the chart, do the following:

  • Determine your household’s population by counting the number of individuals living in your home along the top row. Listed below is the total number of persons that filed a federal tax return with you. If your expected 2019 adjusted gross income (AGI) falls under the restrictions listed in the relevant column, you should consider filing a tax return for 2019. (Your adjusted gross income (AGI) is the amount on line 37 of your Form 1040.)

The possibility of receiving a subsidy exists if you believe that your total household AGI in 2019 will be within the specified limitations.

People in Your Household 1 2 3 4 5 6
You may qualify for a 2019 premium subsidy if your yearly income is between …. $17,237 -$48,560 $23,337 – $65,840 $29,436 -$83,120 $35,536 – $100,400 $41,636 – $117,680 $47,735 – $134,960
You may qualify for a premium subsidy AND a cost share reduction if your yearly income is between… $17,237 -$30,350 $23,337 – $41,150 $29,436 -$51,950 $35,536 – $62,750 $41,636 – $73,550 $47,735 – $84,350

The Federal Poverty Level Guidelines are the source of this information.

Medicaid Expansion Affects 2019 Subsidy Levels in Virginia

Please keep in mind that Virginia implemented Medicaid expansion on January 1, 2019. This has resulted in an increase in the income threshold for qualifying for health insurance subsidies in Virginia for 2019. If you believe you may be eligible for Medicaid, please visit the Medicaid page for your state for further information:

Enroll in 2019 Health Insurance

Within the time period of November 1, 2018 to December 15, 2018, you can enroll in a health insurance plan for 2019. This is an open enrollment period. It is anticipated that your coverage will begin on January 1, 2019. To enroll in a new individual health insurance plan outside of open enrollment, you must have a qualifying event occur. Establish your eligibility for a subsidy and then take advantage of that subsidy by purchasing your health insurance through the state’s marketplace. If you reside in Virginia, you can enroll in a plan by visiting the website.

In Maryland, go to the Maryland Health Connection for further information.

2022 Obamacare Subsidy Chart and Calculator

The most recent revision was made on October 27th, 2021. What resources are available to assist you in paying for health insurance and health coverage? It all depends on how much money you make. The cost of the “benchmark plan” (the second-lowest-cost silver plan on the exchange) exceeds a certain percentage of your income in 2022, with a maximum of 8.5 percent if you are eligible for Obamacare subsidies. The income cut-off criterion grows on a sliding basis based on your household’s net worth.

Health plans for 2022 are evaluated in relation to your predicted income for 2022 as well as the benchmark plan cost.

New participants will pay around $30 less per person per month in premiums in 2021, a 25 percent decrease from the previous year.

If you have previously registered in an ACA plan and received a subsidy, you may be able to switch plans and get the additional savings until August 15th in the majority of states.

For the first eight months of the year, those enrolled in health coverage through the federal exchange will have their additional subsidies automatically deducted from their premium due amount.

Next Steps

The bottom conclusion is that it pays to double-check your qualifying levels, regardless of your income level. You may use sites such as HealthCareInsider.com or the calculator above to find out your subsidy rate or to determine whether or not switching is the best option for your circumstances.

Learn More About Obamacare Subsidies

In order to calculate your 2022 Obamacare subsidy, you must first determine how much you will get. Subsidies, also known as premium tax credits, are calculated based on three factors: your income, the list price of the benchmark plan, and the amount of money you are required to contribute toward your health insurance under the Affordable Care Act. The real subsidy is the difference between the benchmark plan and the amount of your planned contribution to the program. Due to the fact that you often apply for coverage before the year begins, you’ll need to generate a solid estimate of how much money you’ll make in advance.

Prior to 2021, you were supposed to contribute anything from 2 percent to 9.83 percent of your gross income, depending on your position.

For a family of four, that amounted to $104,800 in annual earnings.

Previous 2021 Total Household Income for Maximum ACA Subsidy

Household Size Household Income
1 person $51,040
2 people $68,960
3 people $86,880
4 people $104,800
5 people $122,720
6 people $140,640
7 people $158,560
8 people $176,480

Alaska and Hawaii are the only two states that have greater income restrictions, and you can find them here. What Will Be Different About Obamacare Subsidies in 2022? The American Rescue Plan completely transformed the year 2022. (with the possibility of this change being made permanent in the near future). The American Rescue Plan Act (ARP) of 2021 made the Affordable Care Act (ACA) more affordable for more Americans (ACA). How? There are three basic ways to do this: First and foremost, the Federal Poverty Level (FPL) income ceiling requirement was eliminated by this legislation.

  1. Under the ARP, the standard Silver plan will not cost you more than 8.5 percent of your yearly family income, regardless of how much money you make or how much you earn.
  2. Second, it doubled the amount of subsidies that those earning less than 400 percent of the federal poverty level (FPL) are eligible for.
  3. For the past two years, the range has been reduced to 0 percent to 8.5 percent.
  4. As part of its rescue efforts, the American Rescue Plan has created a Special Enrollment Period on the federal Health Insurance Exchange.
  5. Even if you’ve previously enrolled in a health plan, you can change your mind and enroll in a new plan in most states (or reenroll in the same one).

It has been reported by the federal government that typical premiums have reduced by around $30 per person per month on average, and that median deductibles have dropped by 90 percent, from $450 to roughly $50 per year. What You Pay for a Benchmark Silver Plan and What You Can Expect

Income (by federal poverty level) % of Your Income (before 2021) % of Your Income (in 2021)
100% – 138% 2.07% 0%
138% – 150% 3.10% – 4.14% 0%
150% – 200% 4.14% – 6.52% 0.0% – 2.0%
200% – 250% 6.52% – 8.33% 2.0% – 4.0%
250% – 300% 8.33% – 9.83% 4.0% – 6.0%
300% – 400% 9.83% 6.0% – 8.5%
Over 400% Not eligible 8.50%

Internal Revenue Service, 26 CFR 601.105, irs.gov. Original source: Internal Revenue Service. Congress of the United States of America, accessed March 20, 2021. H.R. 1319 may be found at congress.gov. This page was last updated on March 20, 2021. Households with more than 8 persons will need to contribute $4,480 per person to their budget. What If Medicaid Were Used Instead of Subsidies? In most states, those who earn up to 138 percent of the federal poverty threshold are eligible for Medicaid benefits rather than ACA exchange subsidies, according to the Centers for Medicare and Medicaid Services.

  1. Alaska and Hawaii are the only two states with greater income restrictions, and you can find them right here.
  2. During the year 2022, this information – as well as certain household income numbers – are applicable to health insurance policies that will cover you and your family.
  3. Approximately once a year, in January, the federal poverty level income levels are updated.
  4. They are also employed in November, when the Affordable Care Act’s Open Enrollment Period commences.
  5. Your modified adjusted gross income, often known as MAGI, is the correct amount of income to submit (basically, the annual income you report on your tax return,with a few tweaks).
  6. No of how much money you make every year, you may still ” qualify for Obamacare.” If you earn more than the income limit, you will simply not be eligible for monthly premium assistance benefits.
  7. Medicaid, on the other hand, is likely to be available in the majority of states.

2021 Total Household Income for Minimum ACA Subsidy

Household Size Household Income
1 person $12,880
2 people $17,420
3 people $21,960
4 people $26,500
5 people $31,040
6 people $35,580
7 people $40,120
8 people $44,660

If You Do Not Qualify: If your household earns too much to qualify for a subsidy, you may want to investigate purchasing insurance outside of the marketplace. These plans are essentially comparable to subsidy-eligible plans in terms of design, pricing, and adherence to Affordable Care Act regulations. There are certain places where you may buy off-exchange Silver plans that are similar to their on-exchange counterparts but have a lower unsubsidized price, thanks to an insurance pricing method known as “Silver Loading,” which lowers the cost of coverage for those who don’t qualify for subsidies.

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According on your location, you may also discover that various insurers sell plans outside of the exchange, providing you with a greater variety of possibilities from which to pick.

According to the 2021 American Rescue Plan, persons earning up to 150 percent of the federal poverty level (FPL) can enroll in a Silver benchmark plan for $0, with significantly lower deductibles and other out-of-pocket expenditures.

If you received unemployment benefits or were accepted for them at any point during the year 2021, you may also be eligible for the enhanced subsidies available through the federal Health Insurance Marketplace, which was launched in 2014.

Individuals earning more than the income threshold were previously unable to qualify and were required to pay full price, whether they purchased on or off the exchange.

Low Cost Marketplace Health Care, Qualifying Income Levels

Check to see if you qualify for Medicaid or the Children’s Health Insurance Program (CHIP) depending on your income and whether you may save money on your Marketplace rates. Alternatively, find out who should be included in your family and how to assess your income before you ask for assistance. You’ll be able to view the specific plan rates as well as how much money you’ll save by completing a Marketplace application. Decide on your state. Include yourself, your spouse if you are married, and anybody else who will be claimed as a tax dependant in 2022 — even if they do not require coverage.

Select the anticipated income range for each person in your family who has been included in this calculation.

More help before you apply

  • Creating an estimate of your estimated household income in 2022
  • You may most likely start with your household’sadjusted gross income and modify it as necessary to account for anticipated changes. (Savings are based on your income estimate for the year in which you seek coverage, not your income estimate for the previous year.) Make the most accurate estimate of your salary possible by using our income calculator. Learn more about calculating income and what to include in your calculations.
  • Take into account yourself, your spouse if you’re married, as well as everyone else you’ll claim as a tax dependant, even if they don’t require coverage
  • And Find out more about who should be included in your home.

Understanding Obamacare Subsidies and Eligibility

Middle- and low-income families are frequently concerned about how they will pay for health insurance in the future. Obamacare, commonly known as the Affordable Care Act (ACA), offers subsidies to eligible people and families in order to make health insurance coverage more affordable for them.

What are ACA tax credit subsidies?

Acquired by the Affordable Care Act, subsidies are tax credits that are available to many people with net incomes between 100 percent and 400 percent of the federal poverty level (FPL). Medicaid and ACA subsidies are used to cover the costs of health insurance premiums for persons who would otherwise be unable to afford coverage. In general, persons who get ACA subsidies are also protected against rising premiums since ACA subsidies often grow (or decrease) in proportion to the increase (or drop) in rates.

According to the Centers for Medicare and Medicaid Services (CMS), 87 percent of the 10.7 million consumers who purchased health insurance through the Marketplace in 2020 got premium subsidies under the Affordable Care Act.

Obamacare Subsidy Eligibility

Subsidies, sometimes known as tax credits, are available under Obamacare and are calculated on a sliding scale. They cap the amount of money you have to pay in monthly premiums at a certain proportion of your gross annual income. The majority of people are eligible for subsidies if they earn between 100 percent and 400 percent of the federal poverty level. Take note that the American Rescue Plan Act (ARPA), which was signed into law on March 11, 2021, will provide additional and temporary relief to many Americans who are struggling to find affordable health insurance during the economic and social trauma caused by the COVID 19 pandemic in the United States.

For example, the ARPA provides that:

  • For a Silver plan on the Marketplace, no citizen or lawfully present noncitizen who does not have access to other affordable insurance (such as through an employer, Medicaid, or Medicare) would have to pay more than 8.5 percent of their income. The vast majority of persons who get at least one week of unemployment compensation at any point in 2021 will be eligible to enroll in a Silver plan with no premiums and cost-sharing reductions. In order to qualify for some cost-sharing reductions of Marketplace plans accessible to persons with lower incomes, individuals must earn at least 500 percent of the federal poverty level (FPL) and have no other affordable health insurance options available to them.

It is possible that you will qualify for Medicaid based on your income if your income is less than 138 percent of the federal poverty level (FPL) and your state has extended Medicaid coverage to more people. In the event that your income falls below the federal poverty level, you may be ineligible for subsidies, but you are more likely to be eligible for Medicaid.

Medicaid is a federally funded health-care program for low-income people and families in the United States. In order to be eligible for Obamacare subsidies, you must satisfy the following requirements:

  • You are presently a resident of the United States of America. You are a citizen or legal resident of the United States
  • You are not currently imprisoned
  • Nonetheless, Your income does not exceed 400 percent (or 500 percent in 2021 and 2022) of the federal poverty level.

According to the Federal Register, the FPL for an individual in 2021 will be $12,8800.25 per year. In your family, the FPL changes depending on the number of people that live there. Alaska and Hawaii have significantly different degrees of poverty. The Obamacare household income table is updated on an annual basis since poverty rates are updated to account for inflation each year. The following are the federal poverty criteria for the year 2021:

Household size 100% of Federal Poverty level (2021) 400% of Federal Poverty Level (2021)
1 $12,880 $51,520
2 $17,420 $69,680
3 $21,960 $87,840
4 $26,500 $106,000
5 $31,040 $124,160
6 $35,580 $142,320
7 $40,120 $160,480
8 $44,660 $178,640

Source:Healthcare.gov Levels of Poverty in the United States In order to determine if you are eligible for a premium cost reduction through the Obamacare tax credit if you purchase Marketplace insurance for 2022 coverage, you must use the federal poverty requirements for 2021. If you purchase Marketplace insurance for the year 2021, check the second and last columns of the table above to discover if you are eligible for an Obamacare tax credit under the Affordable Care Act.

How Obamacare subsidies work

Subsidies under the Affordable Care Act come in two varieties. The most prevalent type is referred to as “Advanced Premium Credits,” which may be used to help pay for health insurance premiums obtained through the Marketplace under the Affordable Care Act throughout the year. If you meet the requirements based on your predicted income for the current year, you can choose between the following options:

  1. Consider taking the tax credit throughout the year, which will be given directly to your health insurance to offset the cost of your coverage premiums, or paying the premium in full each month and receiving your tax credit when you submit your income tax return.

If you accept the advance tax credit each month (as described in Option 1 above) and understate your real household income, you will be required to repay a portion of the money you received in advance at the end of the year. If you overestimate your income, on the other hand, you will receive an adjusted tax credit refund when you complete your income tax return. In order to avoid this problem, you should report changes to your income by updating your Marketplace application online or by calling the Marketplace customer service center.

ACA-compliant plans marketed outside of the Marketplace, catastrophic coverage plans, short-term health insurance, stand-alone prescription drug plans, and insurance supplements for services such as dentistry, vision and critical illness are not eligible for these credits.

In the Affordable Care Act, a second type of subsidy is referred to as a “Cost-Sharing Reduction (CSR) Subsidy.” The cost-sharing reduction (CSR) subsidy can lower your out-of-pocket costs for covered treatments if you are qualified by covering a portion of your deductible, copayment, or coinsurance.

Things to know about Obamacare subsidies

Anyone who is wondering about their eligibility for Obamacare subsidies should be aware of the following information:

  • This year’s tax return does not count against your eligibility for subsidies since your income during the year in which you are covered by your health insurance plan does not count toward your eligibility for subsidies. This implies that when asking for subsidies, you must make an educated guess about your income. It is possible that you will be obliged to repay part or all of the subsidy monies that were allocated on your behalf to your monthly health insurance payments if you earn more than you anticipated throughout the course of the year. It is possible that you could be entitled to further subsidy support if your earnings are lower than projected throughout the year
  • This assistance will be applied when you complete your taxes for the year.

Applying for Obamacare subsidies

Applicants can submit an application for Obamacare subsidies through their state’s government-run health insurance Marketplace, as well as qualified licensed brokers and private online Marketplaces that work in conjunction with the government-run marketplace. eHealth is a wonderful resource for satisfying all of your insurance coverage requirements. We provide you with online tools to assist you in determining whether or not you are qualified for Obamacare subsidies and Marketplace plans that are available in your area.

With assistance accessible 24 hours a day, seven days a week and a large number of plans to choose from, you can be confident that eHealth is here to assist you in finding and maintaining the best insurance for you and your family.

While you may browse for a health plan through eHealth, the subsidy is provided through a government-run marketplace, not eHealth. Consider all of your individual and family health insurance alternatives available to you through eHealth if you are ready to begin comparing plans.

Eligibility for the Premium Tax Credit

  • You or a member of your tax family who was enrolled in health insurance coverage through the Marketplace for at least one month during a calendar year in which the enrolled individual was not eligible for affordable coverage through an eligible employer-sponsored plan that provides minimum value or eligible to enroll in government health coverage – such as Medicare, Medicaid, or TRICARE
  • And In addition, you must make sure that the health insurance payments for at least one of those same months are paid before the initial filing deadline. They can be paid either by you or by someone else, and they can be paid in advance credit installments. You have a household income that is within specified restrictions. When filing a joint return, if you or your spouse (if filing separately) receives, or is allowed to receive, unemployment compensation for any week commencing during the year 2021, your household income is assumed to be under these limits for that year. You do not file a joint tax return with your spouse
  • Instead, you submit a single tax return with your spouse.
  • There are certain exceptions, such as those for victims of domestic violence or spousal abandonment. The Premium Tax Credit questions and answers provide further information on these exclusions.
  • You are not eligible to be claimed as a dependant by another individual.

Purchasing insurance outside of the Marketplace will exclude you from being eligible for the premium tax credit. Utilize the “Am I Eligible to Claim the Premium Tax Credit?” interactive interview tool to determine whether or not you are eligible to claim the premium tax credit.

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Income Criteria

Compensation for Unemployment in 2021. You are considered to have met the household income requirements for receiving a premium tax credit if you or your spouse (if you are filing a joint return) received or were approved to receive unemployment compensation for any week beginning during 2021 and the amount of your household income is no greater than 133 percent of the federal poverty line for your family size at the time of the claim.

  • Eligibility for the Premium Tax Credit in 2021 and 2022.
  • Generally speaking, to be eligible for the premium tax credit, your household income must be at least 100 percent, and for years other than 2021 and 2022, it must be no more than 400 percent, of the federal poverty line for your family size.
  • It’s important to remember that merely reaching the income threshold does not automatically qualify you for the premium tax credit.
  • See the instructions to Form 8962 for further information on the two exclusions that apply to persons whose family income is less than 100 percent of the federal poverty threshold.
  • Those with lower earnings are eligible for higher credit amounts while those with higher incomes are eligible for lower credit amounts. When advance credit payments received on your behalf exceed the amount of premium tax credit permitted, you will be required to refund part or all of the excess for any tax year other than the current tax year. If your household income is 400 percent or more of the federal poverty level for your family size, you will be required to refund all of your excess advance credit payments for that tax year
  • Otherwise, you will not be required to repay any of your excess advance credit payments. Make sure to carefully analyze the amount of advance credit payments you opt to have made on your behalf if your predicted household income is on the verge of exceeding the 400 percent upper limit. With the exception of tax years 2021 and 2022, if your household income as reported on your tax return is more than 400 percent of the federal poverty line for your family size, you will not be eligible for the premium tax credit and will be required to repay all of the advance credit payments that were made to you on your and your tax family members’ behalf.

If you want to know more about the federal poverty standards for the purpose of claiming the premium tax credit, you should read the instructions to Form 8962, Premium Tax Credit (PTC). The federal poverty criteria are commonly referred to as the “federal poverty line,” abbreviated as FPL for short. Every year, the Department of Health and Human Services (HHS) decides the amounts that qualify as federal poverty guidelines. The Department of Health and Human Services (HHS) publishes three federal poverty guidelines: one for inhabitants of the 48 contiguous states and Washington, D.C., one for residents of Alaska, and one for residents of Hawaii.

As a result, the federal poverty limits issued in January 2020 are being utilized to determine eligibility for premium tax credit benefits in 2021.

Filing a tax return online is the quickest and most accurate method of submitting a complete and correct tax return. Free volunteer aid, IRS Free File, commercial software, and professional assistance are all available as electronic filing choices.

Other Criteria

Aside from your income, there are a number of additional criteria that influence the amount of credit you receive, including:

  • The cost of available insurance coverage
  • Your geographic location
  • Your mailing address
  • The number of people in your family

Married Filing Separately

In the event that you are married and submit your tax return under the marital filing status, you will not be entitled for the premium tax credit unless you are a victim of domestic violence or spousal abandonment and can demonstrate specific conditions. The instructions for Form 8962 and Publication 974 include specifics on how to qualify for this relief. For the purposes of this section, a taxpayer who lives apart from his or her spouse for more than half of the tax year is considered unmarried if the taxpayer files a separate return, maintains a household that is also the primary residence of the taxpayer’s dependent child for more than half of the year, and provides more than half of the household’s expenses during the tax year.

Adult Income Chart

Adults:If you are an adult, the table below will help you determine where you should begin your search for health insurance coverage under the Affordable Care Act (ACA). A family income of roughly 138 percent of the federal poverty level or less is required for adults applying via the state of Indiana at the state application. Adults with household earnings between about 138 percent and 400 percent of the federal poverty level (FPL) may be eligible for subsidized health insurance through the federal health exchange and should submit an application through the federal application process.

Call 800-318-2596 if you need assistance.

Household Size Family Income *
1 $17,780.40 or less $17,780.41 – $51,520.00 $51,520.01 or more
2 $24,043.20 or less $24,043.21 – $69,680.00 $69,680.01 or more
3 $30,306.00 or less $30,306.01 – $87,840.00 $87,840.01 or more
4 $36,581.40 or less $36,581.41 – $106,000.00 $106,000.01 or more
5 $42,844.20 or less $42,844.21 – $124,160.00 $124,160.01 or more
6 $49,107.00 or less $49,107.01 – $142,320.00 $142,320.01 or more
7 $55,370.40 or less $55,370.41 – $160,480.00 $160,480.01 or more
8 $61,633.20 or less $61,633.21 – $178,640.00 $178,640.01 or more

Application for Indiana’s Health Insurance Programs (Legislation) Applicant’s projected 2021 gross household income (not take-home pay); the incomes mentioned are based on the federal poverty line in 2021. *Applicant’s projected 2021 gross household income (not take-home pay). To download a printed version of this document, please click here.

ACA Premium Subsidies: Are You Eligible?

Application for Health Insurance Coverage in Indiana Applicant’s projected 2021 gross household income (not take-home pay); the incomes mentioned are based on the federal poverty line in 2021. *Applicant’s projected 2021 gross household income (not take-home pay) You may print this page by clicking here.

Who Qualifies for the Premium Tax Credit?

If your individual income is between $12,880 and $51,520, or between 100 percent and 400 percent of the federal poverty level, you may be eligible for a premium tax credit. 2,3 The American Rescue Plan Act, which was passed by the federal government in March 2021 and extended the qualifying standards for subsidies, was adopted.

Because of this, a greater number of consumers may be eligible for lower premiums or premium subsidies. 4 You may possibly be eligible for health insurance with no monthly payment!

What Is the Income Limit for ACA Subsidies in 2021? 3

Individuals with incomes ranging from $12,880 and $51,520 will be eligible for ACA subsidies in 2021. 2,3Families of four with a household income ranging between $26,500 and $106,000 may also be eligible for premium assistance. How do you determine if you are eligible for a premium subsidy under the Affordable Care Act? We’ll make things simple for you. The figure below shows the qualifying income ranges in 2021 for the 48 contiguous United States states and the District of Columbia, as of January 2021, for each of the states listed.

Income Limits for ACA Premium Subsidies3

Household Size Minimum Income –100% Federal Poverty Level Maximum Income –400% Federal Poverty Level
One individual $12,880 $51,520
Family of 2 $17,420 $69,680
Family of 3 $21,960 $87,840
Family of 4 $26,500 $106,000
Family of 5 $31,040 $124,160
Family of 6 $35,580 $142,320
Family of 7 $40,120 $160,480
Family of 8 $44,660 $178,640

Families/households with more than eight members should budget an extra $4,540 for each new member of the household. 5

Find Subsidies and Shop for a Subsidized ACA Plan Now

Are you still eligible for the current ACA subsidies, or are you eligible for any additional premium subsidies under the Affordable Care Act? HealthMarkets can assist you in determining whether or not you are eligible for a subsidy. The cutting-edge HealthMarkets FitScore® can assist you in evaluating your alternatives and comparing plans that meet your requirements. You only need to answer a few brief questions about what’s important to you, and the FitScore will utilize your answers to determine which plans are the best fit for your needs.

How Is Income Calculated for Health Insurance Subsidy Eligibility?

MAGI is used to assess whether or not a person is eligible for ACA premium subsidies, but it is an ACA-specific computation that varies from other forms of MAGI. kate sept2004 / courtesy of Getty Images. For those who purchase their own health insurance in the United States (as opposed to those who receive coverage through an employer or through a government-run program such as Medicare or Medicaid), you’re probably aware of the premium subsidies (premium tax credits) established by the Affordable Care Act (ACA).

kate sept2004 / courtesy of Getty Images.

Understanding MAGI

Because of this, the Affordable Care Act (ACA) refers to “modified adjusted gross income” (MAGI) when describing how income will be computed for premium subsidy eligibility. This is valid terminology because the computation is a modification of adjusted gross income. However, the idea of MAGI was already in use for other tax-related purposes, and it is computed in a slightly different way, which has led to some misunderstanding. The most essential thing to take away from this is that MAGI for the purpose of determining eligibility for premium subsidies (and, in many circumstances, Medicaid eligibility) is not the same as the MAGI definition that you may have already known in the past.

However, even within this group, the computation differs slightly between eligibility for Medicaid and CHIP vs eligibility for financial help with commercial health insurance obtained via the exchange.

Fortunately, it is computed in such a way that you have greater freedom in adjusting your MAGI in order to maximize your eligibility for premium subsidies.

Premium Subsidies, Cost-Sharing Reductions, Medicaid, and CHIP

ACA-specific When customers search for coverage through their state’s health insurance exchange, MAGI is used to assess eligibility for premium subsidies (the subsidy is essentially a tax credit that can be utilized immediately or on your tax return) and cost-sharing reductions. It is also used to determine whether or not a person is eligible for CHIP and Medicaid.

How Does the Calculation Work?

In case you’re not familiar with the notion of modified adjusted gross income (MAGI), it’s important to understand that it requires you to start with your adjusted gross income and then subtract different items from it, such as deductions for student loan interest and IRA contributions. (Please keep in mind that AGI may be found on your tax return; AGI is on line 11 on the 2020 Form 1040, although the location on the form can vary from year to year.) However, when it comes to ACA-specific MAGI, you don’t have to subtract either of those sums—or the vast majority of the other amounts that you’d have to subtract from your income in order to calculate your standard MAGI—from your gross income.

As an alternative, the ACA-specific MAGI calculation starts with adjusted gross income and subtracts only three items from it:

  • Line 6a minus Line 6b on the 2020 Form 1040 denotes nontaxable Social Security income
  • Line 2a denotes tax-free interest on the 2020 Form 1040 denotes tax-free interest on the 2020 Form 1040
  • And Line 2b denotes tax-free interest on the 2020 Form 1040 denotes tax-free interest on the 2020 Form 1040. Form 2555 is used to report foreign earned income and housing expenditures for Americans who are stationed abroad.

A large number of people have incomes that are entirely accounted for by these three items, which means that their ACA-specific MAGI is identical to the income shown on their tax return. However, if you have amounts on your tax return for any of those three categories, you must add them to your AGI in order to estimate your MAGI for the purpose of determining your eligibility for premium subsidies and cost-sharing reductions. When determining Medicaid and CHIP eligibility, some amounts are either removed or tallied in a specified way, as follows:

  • When it comes to Medicaid eligibility, qualified lottery winnings and lump-sum income (including inheritances, tax refunds, and other similar sources) are only counted in the month in which they are received if the amount is less than $80,000
  • Larger amounts are prorated over a longer timeframe (Medicaid eligibility is based on monthly income
  • Premium subsidy eligibility is based on annual income, so a lump-sum payment would affect the entire year’s subsidy eligibility, whereas it would only affect a single Certain payments to American Indians and Alaska Natives are subtracted if they were included in AGI
  • Scholarships, awards, and fellowship grants are subtracted if they were included in AGI (as long as they were used for education expenses rather than living expenses)
  • And Certain payments to American Indians and Alaska Natives are subtracted if they were included in AGI
  • And Certain payments to American Indians and Alaska Natives are subtracted if they were included in AGI. It is not included in MAGI the nominal amounts obtained as a result of government subsidies by parent mentors who assist other families in enrolling in health insurance.
See also:  Where To Mail 2018 Federal Tax Return?

Other MAGI Factors to Keep in Mind

However, depending on whether the family is applying for Medicaid/CHIP or premium subsidies, there are varying criteria for how a child’s income is tallied against the family’s overall MAGI. The filing of a joint tax return is required if a married couple wishes to apply for premium subsidies in the exchange (or to claim them on their tax return after paying the full amount for a plan obtained through the exchange). However, if a married couple who lives together applies for Medicaid, their entire household income is considered as a single entity, regardless of how they file their tax returns.

Premium subsidies are a type of tax credit.

If your income is consistent from one year to the next, you may make a reasonable estimate of your modified adjusted gross income (MAGI) for the upcoming year using your previous year’s tax return.

You can submit your updated income to the exchange after the year has begun, and the exchange will make real-time adjustments to your premium subsidy amount if you see that your actual income is considerably different from what you expected (or switch you from a private plan to Medicaid or vice versa, if your changed income results in a change in Medicaid eligibility status).

If it turns out that the subsidy amount that was paid on your behalf during the year was insufficient, the Internal Revenue Service will reimburse you for the shortfall when you file your tax return.

In the instructions for Form 8962 (which must be included with your tax return in the event that you were paid a premium tax credit during the year or in the event that you want to claim the tax credit on your tax return), the specifics of how to conduct a premium tax credit reconciliation are explained.

The IRS required customers who earned more than this amount to reimburse the whole amount of their premium tax credit to the IRS when they filed their tax return.

However, the American Rescue Plan has decided to forego the return of surplus subsidies until 2020.

In addition, the bill reduced the income ceiling for subsidy eligibility in 2021 and 2022, effective January 1, 2021.

However, Congress may make the abolition of the income ceiling for subsidy eligibility permanent; this is something that will be considered in the autumn of 2021.

How Saving Money Might Make You Eligible for Subsidies

In light of the way the ACA-specific MAGI is computed, there are various steps you may take to lower your MAGI and thereby qualify for a greater subsidy than you would otherwise qualify for (if the income limit for subsidy eligibility is allowed to take effect again in 2023, this approach will once again be particularly important in order to avoid the “subsidy cliff” when MAGI exceeds 400 percent of the poverty level).

It should be noted that, for the purpose of determining eligibility for premium subsidies, the poverty level statistics from the previous year are always utilized, because open enrollment for a given year’s coverage is completed before the poverty level numbers for that year are decided (for Medicaid and CHIP eligibility, current poverty level numbers are used, since enrollment in those plans continues year-round).

As a result, eligibility for premium subsidies in 2022 will be determined by how the enrollee’s expected 2022 income compares to the federal poverty line figures for 2021.

However, the higher your modified adjusted gross income (MAGI), the smaller your subsidy amount will be.

If your employment situation and health insurance plan allow it, it may be possible for you to save a significant amount of money in a retirement account (which includes traditional IRAs, but also things like 401(k)s, SEP-IRAs, SIMPLE-IRAs, solo 401(k)s, which tend to have higher contribution limits) and/or a health savings account, thereby lowering the amount of income you report on your tax return.

This might result in you receiving a subsidy when you would otherwise have been required to pay the whole cost of your coverage, or it could result in you receiving a greater subsidy than you would have gotten if you had not made the pre-tax payments to your account.

To be clear, keep in mind that donations to items like an HSA and conventional IRAs (but not contributions to a Roth IRA because those contributions are not pre-tax) will lower your ACA-specific MAGI, even if those contributions do not impact your other forms of MAGI calculations.

2021 2022 2023 Federal Poverty Levels (FPL) For ACA Health Insurance

Health coverage under the Affordable Care Act (ACA), generally known as Obamacare, is available to anyone who do not have health insurance through their employer.

In order to keep premiums cheap, a premium subsidy in the form of a tax credit, based on your income in relation to the Federal Poverty Levels (FPL), commonly known as the Health and Human Services poverty criteria, is provided.

The Maximum Income

Except for the years 2021 and 2022, you are only eligible for the premium subsidy if your modified adjusted gross income (MAGI) is 400 percent or less of the federal poverty level (FPL). If your household income exceeds 400 percent of the federal poverty level, even by a single dollar, you forfeit the whole subsidy. See Stay away from the ACA Premium Subsidy Precipice. For the years 2021 and 2022, the American Rescue Act was amended to include a temporary adjustment. The cliff was transformed into a gentle slope as a result.

As your income increases, you just qualify for a reduced level of assistance.

The cliff is expected to reappear in 2023, according to plans.

In order to determine how much you are eligible for the premium subsidy, you must first determine where the FPL is located.

The Minimum Income

In addition to the maximum income that can qualify for the premium subsidy, there is a minimum income that must be met in order to be accepted by the Affordable Care Act marketplace. If your projected income is too low, you will not be accepted into the ACA marketplace. Instead, you’ll be referred to Medicaid. In states that have extended Medicaid, the minimal income is 138 percent of the federal poverty level (FPL). If a state chooses not to extend Medicaid, the minimum income is 100 percent of the federal poverty level.

As a result, in contrast to the maximum income, the minimum income is only considered at the time of enrolment and not at the time of filing your tax return.

If your estimated income at the time of enrollment is greater than the minimum and you are accepted, but your income for the year ends up being less than the minimum due to unforeseen circumstances, you are not required to repay the premium subsidy you have already received as long as you made the original estimate in good faith.

The FPL Numbers

Here are the projections for coverage in the years 2021, 2022, and 2023, respectively. Every year in January, they grow in line with inflation. These are administered with a one-year lag between each application. It is determined if you are eligible for a premium subsidy in 2022 depending on the FPL figures released in 2021.

The new numbers that were revealed in 2022 will be utilized for coverage beginning in the following year, 2023. There are three sets of integers in this equation. The FPLs in Alaska and Hawaii are greater than those in the lower 48 states and Washington, D.C.

48 Contiguous States and Washington DC

Number of persons in household 2021 coverage 2022 coverage 2023 coverage
1 $12,760 $12,880 $13,590
2 $17,240 $17,420 $18,310
3 $21,720 $21,960 $23,030
4 $26,200 $26,500 $27,750
5 $30,680 $31,040 $32,470
6 $35,160 $35,580 $37,190
7 $39,640 $40,120 $41,910
8 $44,120 $44,660 $46,630
more add $4,480 each add $4,540 each add $4,720 each

Alaska

Number of persons in household 2021 coverage 2022 coverage 2023 coverage
1 $15,950 $16,090 $16,990
2 $21,550 $21,770 $22,890
3 $27,150 $27,450 $28,790
4 $32,750 $33,130 $34,690
5 $38,350 $38,810 $40,590
6 $43,950 $44,490 $46,490
7 $49,550 $50,170 $52,390
8 $55,150 $55,850 $58,290
more add $5,600 each add $5,680 each add $5,900 each

Hawaii

Number of persons in household 2021 coverage 2022 coverage 2023 coverage
1 $14,680 $14,820 $15,630
2 $19,830 $20,040 $21,060
3 $24,980 $25,260 $26,490
4 $30,130 $30,480 $31,920
5 $35,280 $35,700 $37,350
6 $40,430 $40,920 $42,780
7 $45,580 $46,140 $48,210
8 $50,730 $51,360 $53,640
more add $5,150 each add $5,220 each add $5,430 each
  • Among the notices issued by the Department of Health and Human Services are 2020-00858
  • 2021-01969
  • 2022-01166
  • And 2020-00858
  • Department of Health and Human Services
  • Department of Health and Human Services.

The Applicable Percentages

The FPL figures determine one component of your eligibility for the premium subsidy, which is based on your household income. Additionally, a sliding scale known as theApplicable Percentages is used to calculate how much you are expected to pay when you are eligible for the premium subsidy based on your income. In the ACA Health Insurance Premium Tax Credit Percentages, we discuss this topic in detail.

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The chart below outlines the types of financial assistance that you may be eligible for based on the size of your household and your income. Every year in July, when the federal poverty requirements change and the Medical Assistance income thresholds are revised, Minnesotasure updates this data.

  • The Medical Assistance income restrictions are in effect for coverage beginning on July 1, 2021, and ending on June 30, 2022. The income restrictions for MinnesotaCare are set for coverage beginning in 2022. Premium tax credits for private health plans offered via MNsure in the years 2021 and 2022 can be determined using our calculator tool. In accordance with the American Rescue Plan, any household with income more than 200 percent of the federal poverty standards (FPG) may theoretically qualify for a tax credit
  • However, there is a threshold income level below which the tax credit will be zero.

View the income guidelines from the prior year. These income criteria are only intended to be used as a guideline and for informative purposes. The actual eligibility of your claim will be determined by completing an application form.

People in household Medical Assistance for adults over age 18Monthly/annual income no more than Medical Assistance for childrenMonthly/annual income no more than* Medical Assistance for pregnant womenMonthly/annual income no more than MinnesotaCareAnnual income no more than Tax credits for private health plansAnnual income above
1 $1,427 / $17,130 $2,951 / $35,420 does not apply $25,760 $25,760
2 $1,930 / $23,168 $3,992 / $47,905 $4,035 / $48,427 $34,840 $34,840
3 $2,433 / $29,206 $5,032 / $60,390 $5,087 / $61,048 $43,920 $43,920
4 $2,937 / $35,245 $6,072 / $72,875 $6,139 / $73,670 $53,000 $53,000
5 $3,440 / $41,283 $7,113 / $85,360 $7,190 / $86,291 $62,080 $62,080
6 $3,943 / $47,321 $8,153 / $97,845 $8,242 / $98,912 $71,160 $71,160
7 $4,446 / $53,359 $9,194 / $110,330 $9,294 / $111,533 $80,240 $80,240
8 $4,949 / $59,397 $10,234 / $122,815 $10,346 / $124,154 $89,320 $89,320
For each additional person add $503 / $6,038 $1,040 / $12,485 $1,051 / $12,621 $9,080 $9,080

Check out the income standards from the prior year’s tax year. Unless otherwise stated, these income standards are estimates intended solely for informative purposes. To determine your real eligibility, you will need to submit an application.

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