Getting Married Can Affect Your Premium Tax Credit

IRS Health Care Tax Tip 2015-47, August 6, 2015

If you’re a newlywed, be sure to add a health insurance review to your to-do list. This is particularly important if you enrolled in coverage through a Health Insurance Marketplace and receive premium assistance in the form of advance payments of the premium tax credit.

Advance credit payments made to your insurance company are based on an estimate of the credit that you will claim on your federal income tax return. The Marketplace estimates the credit by using information about your family composition and projected income that you provide when you submit your application.

It is important for you to report changes in circumstances to your Marketplace to get the proper type and amount of financial assistance and to avoid getting too much or too little in advance. Reporting changes in circumstances will allow the Marketplace to adjust your advance credit payments. This adjustment will help you avoid getting a smaller refund or owing money that you did not expect to owe on your federal tax return.

To report changes and to adjust the amount of your advance payments of the premium tax credit you must contact your Health Insurance Marketplace. Be sure to report all changes directly to that Marketplace because they can affect both your coverage and your final credit when you file your federal tax return.

Other changes you should report to the Marketplace include:

• Birth or adoption
• Marriage or divorce
• Moving to another address
• Changes in household income

These changes may also open the door for the Marketplace special enrollment period that permits health care plan changes. In most cases, the special enrollment period for Marketplace coverage is open for 60 days from the date of the life event.

Estimating Your Change

The Premium Tax Credit Change Estimator can help you estimate how your premium tax credit will change if your income or family size changes during the year. This estimator tool does not report changes in circumstances to your Marketplace. Because these tools provide only an estimate, you should not rely upon them as an accurate calculation of the information you will report on your tax return. You should use these estimators only as a guide to assist you in making decisions regarding your tax situation.

For more information, see the Affordable Care Act Tax Provisions for Individuals and Families page at IRS.gov/aca.

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