The Premium Tax Credit calculator is an essential tool designed to help individuals and families estimate the refundable tax credit they may qualify for under the Affordable Care Act (ACA). This credit helps lower the cost of health insurance premiums purchased through the Health Insurance Marketplace.

Premium Tax Credit Calculator

Estimate your Premium Tax Credit based on your household income, size, plan costs, and eligibility factors.

How the Calculator Works

1. Input Household Information: Users enter their MAGI, household size, and state or county of residence.
2. Determine Income as a Percentage of FPL: The calculator compares MAGI to the FPL for the household size.
3. Find Applicable Contribution Percentage: Based on income percentage of FPL, the calculator applies the IRS sliding scale percentage.
4. Calculate Maximum Contribution: Multiply MAGI by the applicable percentage to find the maximum premium contribution.
5. Determine SLCSP Premium: Retrieve or input the local SLCSP premium.
6. Calculate Premium Tax Credit: The credit equals the difference between the SLCSP premium and the maximum contribution amount.
7. Adjust for Advance Payments: If advance payments were made, the calculator shows the net credit or amount owed at tax time.

FAQs

Q: Who qualifies for the Premium Tax Credit?
A: Individuals and families with household incomes between 100% and 400% of the federal poverty level who buy insurance through the Marketplace and meet other IRS criteria qualify.

Q: What is the second-lowest cost Silver plan?
A: It is the benchmark health insurance plan used to calculate the premium tax credit, based on cost and coverage level in your area.

Q: Can I claim the credit if I have employer-sponsored insurance?
A: Generally no, unless the employer coverage is not affordable or does not provide minimum value.

Q: How often does the IRS update the contribution percentages?
A: The IRS updates these percentages annually; for 2024, the expected contribution percentage is 8.39% of income.