Premium tax credit and severance pay

[J-lo1969]

I had coverage through the marketplace all year. (2024) My husband had coverage through employer . He lost his job in September very unexpectedly and was paid 6 months severance pay in October which would have technically been pay until the end of March this year 2025 . I reported the income to market place by upping income to the amount of severance pay divided by 3 months. When I do taxes it’s showing we have to pay a bunch back. Which we didn’t know this was going to happen. We have been living on that severance pay through this month, it was not extra income. But obviously on the w2 it looks like he made a lot more in 2024. I also had to put him on marketplace coverage because he lost his insurance. Is there anything I can do to show this situation in tax return so we don’t have to pay a crazy amount back? 

[MinhT1]

Severance pay reported on form W-2 counts as income for determining the health insurance Advance Premium Tax credit. There is no way to separate it.

Please read this Healthcare.gov document for more information.

[J-lo1969]

What i mean is that if income didn’t go up until October,November and December and i put that into healthcare.gov , why would we have to pay back for subsidies on Jan-to September? Especially if we didn’t know anything about this until his last month. I was also the only one on a marketplace plan through October. This just doesn’t seem right.  We would not have been making enough to pay more than we were. Also part of his severance was a piece of equipment that was counted as cash. They took more than half of his severance pay in taxes.  Screw the little guy, I guess