What happens to a young adult who applies for premium tax credits the first year he or she is not a tax dependent, and so he or she hasn’t filed a return in prior years?

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

The biggest challenge a young adult may face in his or her first year of independent tax filing is verifying income, since one of the prime sources of income data is a prior year tax return. However, the Marketplace will accept a consumer attestation if a prior year tax return is not available for the applicant and (in applicable states) if alternative sources also fail to furnish this income information. Thus, the fact that a young adult has not filed in the past will not prevent him or her from receiving premium tax credits when applying for the first time. (45 C.F.R. § 155.320 (c); “Patient Protection and Affordable Care Act, HHS Notice of Benefit and Payment Parameters for 2024,” 88 Fed. Reg. 25740, 25819–20 (Apr. 27, 2023).)

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