ACA subsidies, explained

Two kinds of help

If you buy a health plan through the Health Insurance Marketplace, you may qualify for help paying for it. There are two kinds. A premium tax credit lowers what you pay each month for the plan. Cost-sharing reductions lower your deductible, copays and coinsurance when you get care. If you'd like someone to work through it with you, that's what we do.

The premium tax credit

The credit starts from the premium of a benchmark Silver plan, the second-least-expensive Silver plan in your Marketplace, minus a share of your household income, and it can't be more than the premiums for the plans you and your family enroll in. It works on a sliding scale: the lower your income, the larger the credit. To get it, you must buy your plan through the Marketplace. You generally can't get it if you can get affordable coverage through a job that meets minimum value, or if you can get Medicare, Medicaid, CHIP or TRICARE.

In general, the credit is for households with income from 100% to 400% of the federal poverty line, set by family size. From 2021 through 2025, Congress temporarily removed the 400% limit, so some households above it could qualify in those years. The rules can change, so we check the ones that apply for the year you enroll.

Cost-sharing reductions

Cost-sharing reductions are for people who qualify for the premium tax credit and have household income from 100% to 250% of the poverty line. They come only with Silver plans. You can still use your tax credit on a plan at any metal level, but to get the lower deductible and copays you have to pick Silver. Bronze plans usually cost the least each month but carry the highest deductibles, so you can end up paying more when you get care.

What goes into the numbers

Settling up at tax time

If you take the credit in advance, the Marketplace estimates it from the household income and family you expect. When you file your taxes, you compare the advance payments with the credit you actually qualify for. If the credit is more, the difference is added to your refund or lowers what you owe. If it is less, then starting with tax year 2026 you must pay back the full difference; the cap that used to limit repayment no longer applies. Telling the Marketplace about changes in income or family as they happen lets it adjust your advance payments, which makes a big gap less likely. You must file a tax return for any year you got advance payments, or you can't get them in future years. To compare plans for your situation, see coverage for one adult, couples, families and single parents.

Common questions

Last reviewed October 2026. Marketplace rules can change each year; IRS.gov has the official details on the premium tax credit.