Will You Get in Trouble if You Make Under $12,000 and Buy Health Insurance Through ACA?
If you make under $12,000 a year, you may be eligible for free or low-cost health insurance through Medicaid. However, if you make more than $12,000, you will need to buy health insurance through the Health Insurance Marketplace.
If you make between $12,000 and $48,560 a year, you may be eligible for premium tax credits to help you pay for health insurance. These credits are based on your income and family size. If you estimate your income incorrectly and end up making more than you expected, you will need to pay back some or all of the tax credits you received.
How to Avoid Having to Pay Back Premium Tax Credits
If you are not sure how much you will make in a year, you can estimate your income when you apply for health insurance. However, if you are making less than $12,000 a year, you should not estimate your income to be more than this amount. If you do, you will likely have to pay back premium tax credits when you file your taxes.
If you make more than $12,000 a year, you should estimate your income as accurately as possible. If you underestimate your income, you may not receive enough premium tax credits. If you overestimate your income, you may have to pay back some of the tax credits you receive.
What to Do if You Need to Pay Back Premium Tax Credits
If you need to pay back premium tax credits, you will receive a Form 1095-A from the health insurance marketplace. This form will show you how much you need to repay. You can repay the tax credits by sending a check or money order to the IRS. You can also choose to have the tax credits deducted from your tax refund.
Speak to a Licensed Agent for Help
If you have questions about premium tax credits or how to estimate your income, you can speak to a licensed health insurance agent. They can help you understand your options and choose the best health insurance plan for your needs.
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