Question

Help me understand PREMIUM TAX CREDIT in my situation please...

Forum|Forum|3 years ago
February 6, 2023
1 reply
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At the beginning of 2022 I adjusted my projected annual income from my job at the time, so to make the premium tax credit for health coverage as accurate as possible so there would be no real over payments to me come tax time. In May I changed jobs and my wife got a job at the same time. My new job offered health insurance so I discontinued the marketplace insurance in May at the same time. Now it's time to do taxes and my software is saying I owe $970 based on my annual income. This doesn't seem fair. My projected annual income from my job at the time of marketplace coverage was accurate up until I discontinued. Our income went up when my wife got a job and when I switched to my new job in May which is when I cancelled the marketplace coverage. Why is the IRS using my total income for the whole year to calculate the first 5 months I had marketplace insurance? This just doesn't seem right. Is there something I can do or I'm I forced to comply? Thanks for any advise/help.

Not A Product Question

H

HelenC12

Per IRS tax rules, the premium tax credit (PTC) is based on your annual income. It is not prorated.

At tax time, your PTC is calculated on your reported final yearly income for 2022 not what you estimated.
If your final yearly income is greater than your family's income limit, you may need to pay back some or all of your credit on your tax return.

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