Premium Tax Credit
Insurance Glossary
A federal subsidy that lowers the monthly cost of a health plan bought through the Marketplace, calculated from household income and the price of a benchmark plan in the local area. Most enrollees take it in advance, with the money paid straight to the insurer each month, then reconcile it against actual income when filing a federal tax return, which can produce either a larger refund or an amount owed back. Congress has changed the eligibility rules and income thresholds more than once, so the rules in force for the coverage year are the ones that apply.
This content is for general informational purposes only and is not insurance, legal, or financial advice. Coverage, exclusions, eligibility, and pricing vary by insurer, by policy, and by state, and only the policy documents control what is covered. Always confirm the details of any coverage with a licensed insurance agent or the issuing carrier before you buy.
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