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How to Calculate Your 2017 Obamacare Tax Credit

How to Calculate Your 2017 Obamacare Tax Credit

Are you eligible for a health insurance subsidy in 2017? 

Planning to buy health insurance from a state-based or federally facilitated exchange and curious about your premium tax credit amount?

Estimating your 2017 premium tax credit is as easy as 1-2-3. Just enter your info. Get your results. And find your plan.

The new HealtheDeals.com Health Insurance Cost and Subsidy Calculator will help you determine if you might qualify for an Obamacare subsidy; if so, approximately what amount; and where to shop for your 2017 health insurance plan.

To use the calculator, you will need your estimated household income, ZIP code, date of birth and ages of any additional family members who will be covered by your health insurance plan.

Calculate Your Tax Credit

Who qualifies for premium tax credit subsidies?

Under the Affordable Care Act, premium tax credits are available to low- and moderate-income families as a way to help make health insurance more affordable.[1]

The eligibility criteria are generally as follows[2]:

  1. Your household income must be within 100 and 400 percent of the federal poverty level for your family size. The 2016 federal poverty guidelines used to calculate 2017 subsidies can be found here: aspe.hhs.gov/poverty-guidelines.
  1. You must buy your health insurance plan from a state-based exchange or the federal Health Insurance Marketplace.

If you do not meet both of these criteria, you are unlikely to qualify for a premium tax credit. Additional factors that influence your tax credit eligibility and amount include the following:

  • Medicaid expansion — If you live in a state that expanded its Medicaid program and earn up to 138 percent of the FPL, you may not be eligible for subsidies because you are instead eligible for Medicaid.
  • Your state’s benchmark plan — Premium tax credit subsidies are based on the second-lowest cost silver plan in (i.e., the benchmark plan) in your area.[3] Those who meet the guidelines for an ACA tax credit will pay no more than 2.01 percent to 9.56 percent of their income toward health insurance premiums.[4] As such, a change in benchmark rates can impact the amount of subsidy for which you are eligible and how much you will pay for coverage

With so many variables in the health insurance market, including fluctuating premium rates and their impact on tax credits, it is important to compare your coverage options and recalculate your estimated premium tax credit amount each year.

Curious about how to calculate your subsidy amount manually? You can review the steps and see examples here.

Not eligible for a tax credit to help pay your health insurance premium?

If you don’t qualify for an Obamacare subsidy, you can shop for coverage both on and away from the state-based and federally facilitated exchanges.

Individual health insurance plans sold in the private market may vary from those offered through your state-based exchange and the federal Health Insurance Marketplace since not all carriers sell exchange-based plans and some carriers offer different types of plans in the private market. Compare your on- and off-exchange options and find the rate, network and plan benefits that best meet your budget and healthcare needs.

You can buy ACA-compliant, off-exchange coverage from:

  • Health insurance producers (i.e., agents and brokers)
  • Health insurance carriers
  • Healthedeals.com and other websites that sell ACA-compliant health plans and supplemental coverage

If you have questions about buying health insurance or supplemental products, call the number at the top of your screen to speak with a producer. If you want to find a local agent to help you shop for 2017 Obamacare plans in your area, use Agent Finder!

 

Originally posted December 21, 2015. Updated and reposted on November 10, 2016. 


 

[1] Internal Revenue Service. “Questions and Answers on the Premium Tax Credit.” IRS.gov. Sept. 30, 2015. https://www.irs.gov/Affordable-Care-Act/Individuals-and-Families/Questions-and-Answers-on-the-Premium-Tax-Credit

[2] Ibid.

[3] The Henry J. Kaiser Family Foundation. “Health Insurance Marketplace Calculator.” KFF.org. N.D. http://kff.org/interactive/subsidy-calculator/

[4] Ibid.

This document is for general informational purposes only. While we have attempted to provide current and accurate information, this information is provided "as is" and we make no representations or warranties regarding its accuracy or completeness. The information provided should not be construed as legal or tax advice or as a recommendation of any kind. External users should seek professional advice from their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.

About The IHC Group
Independence Holding Company (NYSE: IHC) is a holding company that is principally engaged in underwriting, administering and/or distributing group and individual disability, specialty and supplemental health, pet, and life insurance through its subsidiaries since 1980. The IHC Group owns three insurance companies (Standard Security Life Insurance Company of New York, Madison National Life Insurance Company, Inc. and Independence American Insurance Company) and IHC Specialty Benefits, Inc., which is a technology-driven insurance sales and marketing company that creates value for insurance producers, carriers and consumers (both individuals and small businesses) through a suite of proprietary tools and products (including ACA plans and small group medical stop-loss). All products are placed with highly rated carriers.

IHC Specialty Benefits, Inc.
IHC Specialty Benefits, Inc., doing business as Health eDeals Insurance Solutions is a full-service marketing and distribution company that focuses on small employer, individual and consumer products. Health eDeals markets products via general agents online, telebrokerage, advisor centers, private label and directly to consumers. For more information about Health eDeals visit http://www.HealtheDeals.com.