General question about estimating taxes for the next year

[DIY_Tax_Person]

When signing up for Covered California benefits on health insurance, I am asked to estimate my income for the year. What happens if you UNDERestimate your income? Do you just pay the difference, or is there a bit of a penalty tacked on?

[Anonymous_]

@Critter-3 

[Critter-3 · Accepted solution]

If this is ACA Marketplace insurance then underestimating the income will effect the Premium Tax Credit you are eligible for so if you got too much in advance you will need to pay some or all of it back on the tax return.