Do I Have to Pay Back the Tax Credit if I Made Less Than 100% FPL?
Do I have to pay back the tax credit if I made less than 100% FPL? For example if I found out at the end of the year I didn’t make enough to get tax credits or was in the Medicaid gap?
Answer
If you made less than 100% FPL but got an advance premium tax credit (APT), the 8962 instructions explain what to do.
In short, as you complete the form and fill out each line, you'll realize your repayment amount is zero in most standard cases. Meanwhile, if you made over 100% but still would have qualified for Medicaid you still owe money back, but it is recapped by the repayment limitations table.
You have to complete the form since you got tax credits, so when you do all questions about repayment will essentially be answered for you.
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Hi. My unemployment might not come through because the PUA in Kansas is a mess. If I don’t get it by the end of the year as owed, I won’t make enough money to qualify for the ACA, and Kansas has not expanded Medicaid. So, I’m guessing I will have to pay all those subsidies back when I do my taxes? I haven’t updated the ACA because I have no idea what my income will be, due to the pandemic and this Unemployment mess.
My main concern is about qualifying for next year. Will I still be able to get subsidies in 2021 if I failed to meet the minimum income requirement for 2020? I can’t lose my health insurance!
Please help! Thanks so very much.
It isn’t as bad as you think on repayment. You’ll likely owe back nothing, but at max about $300. See here: https://obamacarefacts.com/advanced-tax-credit-repayment-limits/
In terms of qualifying for next year, you should for sure meet the requirements since you can predict that your unemployment might come through late I would think, no? A person has many ways to make money in a year, if you think you can do any of these (investments, jobs, unemployment, etc) then you can predict above the 100% level in many cases.
You always want to be honest, but you also need to think about the rules as they stand and your real options. Advanced tax credits are based on your best estimate of what your income will be, and then you settle up at tax time using the repayment rules.