Question

Health Care Tax Credit Subsidies

Forum|Forum|2 years ago
June 28, 2023
2 replies
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On the healthcare.gov tax credit subsidy, particularly in the state of Texas, if you had $0 income for 2023; do you have to return the subsidy when filing for the 2023 tax year federal taxes?

Ask the Experts - Energy - June 2023

MercieD1

If you're referring to the tax credit on your individual return, that is calculated each year based on your income. If you have $0 income in one year and high income the next, the subsidy will be paid pack when your file your return the next year.

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MercieD1

How it works is that the subsidy is applied to your premium. When you file your return the subsidy is reconciled using the form 1095-A. If you're entitled to more, then you get a refund for the rest. If you're entitled to less, you will have to pay it back on your tax return.

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H

hbcracAuthor

Thank you. When you have $0 income; how would it be less entitlement of the tax credit?

MercieD1

According to the IRS:

Household income below 100% of the federal poverty line.

If the amount on line 5 is less than 100%, you can take the PTC if you meet the requirements under Estimated household income at least 100% of the federal poverty line next or Alien lawfully present in the United States, later.

Estimated household income at least 100% of the federal poverty line.

You may qualify for the PTC if your household income is less than 100% of the federal poverty line and you meet all of the following requirements.

No one can claim you as a dependent for the year.
You or an individual in your tax family enrolled in a qualified health plan through a Marketplace.
The Marketplace estimated at the time of enrollment that your household income would be at least 100% of the federal poverty line for your family size for 2022.
APTC was paid for the coverage of one or more months during 2022.
You otherwise qualify as an applicable taxpayer (except for the federal poverty line percentage).

So, if you signed up for Health insurance through the Marketplace when you had income of at least 100% of the Federal Poverty Level, you will be refunded any excess Tax Credit.

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