What happens if I overestimate my income when applying for an ACA plan?
January 2, 2021 7:35 PM Subscribe
I'm recently unemployed. I'm not eligible for Medicaid in my state because I'm not a senior, a parent, or disabled. I applied for (and purchased) a plan on Healthcare.gov with an estimate based on my income in recent years. The amount was just enough to qualify me for a subsidy and keep me out of the coverage gap. But what if I don't actually make enough?
I'm hopeful that I'll find a paying job soon, but in life there are no guarantees, especially not right now.
I've googled this question, but the results I'm getting are all about how the amount of my subsidy will be adjusted when I file my taxes. They don't tell me what will happen if I don't make enough to qualify for a subsidy at all - and that's what I'm worried about.
So what happens if I end up making less than the minimum income to qualify for a subsidy?
Will my insurance plan be deemed invalid?
Will I be expected to pay back the subsidy?
What exactly will happen?
I'm hopeful that I'll find a paying job soon, but in life there are no guarantees, especially not right now.
I've googled this question, but the results I'm getting are all about how the amount of my subsidy will be adjusted when I file my taxes. They don't tell me what will happen if I don't make enough to qualify for a subsidy at all - and that's what I'm worried about.
So what happens if I end up making less than the minimum income to qualify for a subsidy?
Will my insurance plan be deemed invalid?
Will I be expected to pay back the subsidy?
What exactly will happen?
If mods can post a sockpuppet email, I can answer privately.
posted by rikschell at 8:26 PM on January 2, 2021
posted by rikschell at 8:26 PM on January 2, 2021
This site says that if the exchange determines you're eligible but actual income buts you below poverty level, you won't have to repay the tax credits. They referenced this Treasury Ruling, although I didn't read it carefully enough to be sure.
posted by metahawk at 9:57 PM on January 2, 2021 [3 favorites]
posted by metahawk at 9:57 PM on January 2, 2021 [3 favorites]
After mistakenly underestimating my income the first year I was in the ACA, I had to pay the adjusted premium amount at year's end, but there wasn't a nasty penalty.
Subsequent years, I have taken less subsidy than I qualified for, and received a payback at year's end.
I also am in a State that didn't expand medicaid and this year will be close to poverty line because of pandemic. The income they are talking about is adjusted gross income, which is after your standard deduction is taken from your total income.
That means any and all income - even income that isn't reported by others; maybe you have a side hustle where you make $500.00 selling tacos to friends and that magically takes you over the poverty level?
I was hoping there would be legislation !*ha; stupid me*! tat would address this issue during a freking pandemic but, alas, none so far.
posted by mightshould at 2:39 AM on January 3, 2021 [3 favorites]
Subsequent years, I have taken less subsidy than I qualified for, and received a payback at year's end.
I also am in a State that didn't expand medicaid and this year will be close to poverty line because of pandemic. The income they are talking about is adjusted gross income, which is after your standard deduction is taken from your total income.
That means any and all income - even income that isn't reported by others; maybe you have a side hustle where you make $500.00 selling tacos to friends and that magically takes you over the poverty level?
I was hoping there would be legislation !*ha; stupid me*! tat would address this issue during a freking pandemic but, alas, none so far.
posted by mightshould at 2:39 AM on January 3, 2021 [3 favorites]
This thread is closed to new comments.
posted by crazy with stars at 8:23 PM on January 2, 2021