Financial Aid: Tax Credits and Subsidies
If you buy health insurance through your state's health insurance Marketplace, you may be able to get some financial help. The health care reform law helps lower the cost of health insurance for families with low to moderate incomes who make too much money to qualify for Medicaid.
There are two main types of financial help: premium tax credits and cost-sharing subsidies.
The amount of tax credit you qualify for depends on your income and the size of your family. In addition, households with lower incomes may qualify for subsidies to help lower the cost of doctor visits, hospital stays, and other types of medical care.
What is a Tax Credit?
Tax credits help lower your insurance premium, or the payments you make each month for a health plan you buy through your state’s Marketplace. You can receive the tax credit in advance by having all or part of the money sent directly to your insurance company. That will lower your monthly bill. You can also pay the full cost of your insurance premium during the year and take your credit instead at tax time.
How Do I Know If I Can Get a Tax Credit?
When you enroll in a plan through your state's Marketplace, you'll enter your income and the size of your family to learn if you can get a tax credit and how much it will be.
How Much Money Can I Make and Get a Tax Credit?
You may be eligible for a tax credit if the amount of money you expect to make in 2015 is in the following income ranges:
- $11,770 to $47,080 for one adult
- $15,930 to $63,720 for a family of 2
- $20,090 to $80,360 for a family of 3
- $24,250 to $97,000 for a family of 4
The less money you make, the more financial aid you can get. These amounts change each year. The income amounts for people who live in Alaska and Hawaii are slightly different.
Can I Get a Tax Credit If I Get Insurance From an Employer?
No. The Marketplace is the only place where this kind of financial aid is available. And, if your employer offers insurance that is considered affordable under the law, you won’t be eligible for a tax credit, no matter your income.