QUESTION

My income is uneven during the year. Some months I earn very little, other months I earn more. I think my annual income will be low enough to qualify for subsidies next year, but I’m not sure. What if I’m wrong?

Individuals with no coverage | How Premium Tax Credits And Cost-Sharing Reductions Work
ANSWER

It’s common for income to fluctuate, particularly if you are self-employed, perform seasonal work, or have multiple jobs. To achieve the most accurate premium tax credit amount, you should report income changes to the health insurance marketplace within 30 days. Otherwise, if you claim a premium tax credit during the year and your actual income edges over 400 percent of the federal poverty level, you will need to pay back the full credit amount. To avoid this result, you could consider waiting until you file your taxes to take all or a portion of the premium tax credit on your tax return instead of receiving advance payments. (26 C.F.R. § 1.36B-4; 45 C.F.R. § 155.340).

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