Are You Eligible for a Tax Credit Under the ACA?

What is a tax credit?
Tax credits are available to certain individuals and families to help offset the costs of health insurance. However, individuals and families must meet certain income requirements to be eligible to receive a tax credit. Requirements include not having an affordable health plan option from an employer or the government. There are two types of tax credits: Premium Assistance and Cost-Sharing Subsidies. Premium Assistance helps lower the monthly cost of a  health care premium while Cost-Sharing Subsidies aim to decrease patient out of pocket costs such as co-pays, deductibles, co-insurance, etc. The tax credit amount that you recieve is dependent on many factors including the cost of health care where you live and your income level.
Who is eligible for a tax credit?
  • Must be a US citizen, US national, or lawfully present immigrant who purchases health coverage through the Covered California exchange.
  • Annual household income between 138%-400% of the federal poverty level
  • Can’t be eligible for other public health coverage such as Medi-Cal, military coverage, etc. *Exception when the employer’s plan is considered unaffordable or does not offer minimum essential benefits
  • Available to lawfully present immigrants who earn 100% below the federal poverty level but fail to qualify for Medi-Cal
Note: Tax credits are only available for people who purchase health insurance through Covered California. 

Currently, there are no limitations on how long someone may be eligible to receive a tax credit. This means that you can continue to receive tax credits as long as you are considered “eligible” under the requirements. However, if your income changes, then you may lose a portion or all of your tax credit. It is important to notify Covered California in the event that your income level may fluctuate to prevent potential reductions or eligibility for tax credits.

Find out more information on tax credits and whether you qualify here.
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