A TRUSTED INDEPENDENT HEALTH INSURANCE GUIDE SINCE 1999.
Speak with a licensed insurance agent 866-553-3223
Speak with a licensed insurance agent 866-553-3223
A TRUSTED INDEPENDENT HEALTH INSURANCE GUIDE SINCE 1999.
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Will you receive an ACA premium subsidy?
See if you're eligible for the Affordable Care Act's premium tax credits (premium subsidies), how subsidies are calculated, and why they are more robust through 2025.
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Federal poverty guidelines for 2025
The federal poverty level (FPL) - also referred to as the federal poverty guidelines – is used to determine eligibility for Medicaid and CHIP, and for premium subsidies and cost-sharing reductions in the health insurance marketplace.

advance premium tax credit

advance premium tax credit infographic

What is an advance premium tax credit?

An advance premium tax credit, often just called APTC, refers to a premium tax credit (premium subsidy) that's paid throughout the year, directly to the insurer on behalf of an enrollee. This means it's paid in advance, as opposed to the person having to wait and claim it on their tax return the following spring the way most other tax credits work.

Most people who enroll in health coverage through the exchange are eligible for income-based premium tax credits as a result of the Affordable Care Act, the American Rescue Plan, and the Inflation Reduction Act. And the vast majority of those enrollees choose to receive their premium tax credits in advance, rather than waiting until they file their tax return and claiming it all at that point. As of early 2024, 93% of Marketplace enrollees nationwide were receiving APTC.1

When APTC is paid to an insurer on behalf of an exchange/marketplace enrollee, the enrollee must reconcile that when they file their tax return. Their actual premium tax credit is based on the amount that they earned during the year, whereas their advance premium tax credit was based on a projection of what they thought they would earn. If those amounts end up being different, the person might have to repay some or all of the APTC that was paid on their behalf, or they might end up receiving an additional amount of premium tax credit from the IRS.

Footnotes

  1. "Effectuated Enrollment: Early 2024 Snapshot and Full Year 2023 Average" CMS.gov, July 2, 2024 

Will you owe or get a refund on your APTC?

Use our advance premium tax credit repayment & refund calculator

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