I Received Too Much in ACA Health Insurance Tax Credits. Now What?

When you purchase health insurance through the Affordable Care Act (ACA) marketplace, you may be eligible for tax credits to help lower the cost of your premiums. However, if your income changes during the year, you may need to repay some or all of the tax credits you received.

What to Do If You’ve Received Too Much in Tax Credits

If you realize that you’ve received too much in ACA health insurance tax credits, there are a few steps you should take:

1. Gather your paperwork. You’ll need your Form 1095-A, which shows the amount of tax credits you received. You can request a copy of this form from your health insurance company or the Health Insurance Marketplace.
2. File your taxes. When you file your taxes, you’ll need to complete Form 8962, Premium Tax Credit. On this form, you’ll report the amount of tax credits you received and calculate how much you need to repay.
3. Repay the tax credits. If you owe money back, you’ll need to repay it to the IRS when you file your taxes. You can do this by check, money order, or credit card.

How Much Will You Need to Repay?

The amount of tax credits you need to repay depends on your income and the amount of tax credits you received. The IRS has a [repayment calculator](https://www.irs.gov/affordable-care-act/individuals-and-families/premium-tax-credit-repayment-calculator) that you can use to estimate your repayment amount.

Consequences of Not Repaying

If you don’t repay the tax credits you owe, you may have to pay a penalty. The penalty is 1% of the amount of tax credits you owe for each month that you don’t repay.

Avoiding Overpayments

The best way to avoid overpaying your tax credits is to accurately estimate your income when you apply for health insurance through the Health Insurance Marketplace. You can use the [HealthCare.gov income estimator](https://www.healthcare.gov/income-and-family-size/) to help you estimate your income.

If your income changes during the year, you should report the change to the Health Insurance Marketplace as soon as possible. This will help ensure that your tax credits are adjusted accordingly.

Getting Help

If you have any questions about repaying your tax credits, you can contact the IRS at 1-800-829-1040. You can also get help from a tax professional.

Additional Resources

[IRS Publication 974, Premium Tax Credit](https://www.irs.gov/pub/irs-pdf/p974.pdf)
[HealthCare.gov: Premium Tax Credits](https://www.healthcare.gov/glossary/premium-tax-credit/)