I purchased my insurance through the marketplace and received a subsidy that covers my entire premium. I anticipated making just above the amount needed to qualify for a subsidy. My state (SC) has not expanded Medicaid, so a subsidy is the only assistance I would be eligible for. My income would meet the requirements for the subsidy were it not for the deductions on schedule C.
Will I be required to pay the entire subsidy back and will I be allowed to claim the premiums on my deductions as a self employment HI premium if I do have to pay them back? Also, my income situation will change next year as I am contracting with an additional company. Will this impact my ability to qualify for a subsidy in subsequent years?
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No, you will not need to repay the Advance Premium Tax Credit ("subsidy") that you received.
If you honestly submitted your estimated income and the Marketplace gave you Advance credit (they accepted your estimated income), you will not need to repay the credit. In fact, if the credit had not already paid for your entire insurance premium, you would have received additional credit on your tax return.
For any future readers, a key word is "honestly" submitted your estimated income. The law says that if a person were to intentionally lie on their health insurance application (such as falsely increasing income to receive the credit), the penalty is $250,000.
No, you will not need to repay the Advance Premium Tax Credit ("subsidy") that you received.
If you honestly submitted your estimated income and the Marketplace gave you Advance credit (they accepted your estimated income), you will not need to repay the credit. In fact, if the credit had not already paid for your entire insurance premium, you would have received additional credit on your tax return.
For any future readers, a key word is "honestly" submitted your estimated income. The law says that if a person were to intentionally lie on their health insurance application (such as falsely increasing income to receive the credit), the penalty is $250,000.
If at tax filing time it is determined you do not qualify for a subsidy, or for a lesser amount, you will have to pay it back.
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