How the 2027 tax credit works
The Marketplace looks at one plan in your area: the second-lowest-cost Silver plan, called the benchmark. Based on your income, the law sets a share of income you're expected to pay toward that plan. The tax credit covers the rest of the benchmark's price.
You can use the credit on any Bronze, Silver, Gold or Platinum plan. Choose a plan that costs less than the benchmark and you pay less than your expected share. Choose one that costs more and you pay the difference.
Most people take the credit in advance. The Marketplace sends it straight to the insurance company every month, so your premium drops right away. You can also take part of it, or none, and claim it on your tax return.
We are not a government website and not HealthCare.gov. The percentages and income lines here come from the IRS and HHS. The Marketplace makes the final decision on your credit when you apply.
The 400% cliff
From 2021 to 2025 there was no hard income limit. People above 400% of the poverty level could still get a credit if the benchmark cost more than 8.5% of their income. Those larger credits ended and Congress has not renewed them. Under the law as it stands in October 2026, there's no tax credit at all for 2027 above 400% of the poverty level.
That turns the limit into a cliff. Go one dollar over and the whole credit disappears. For one person the line is $63,840. For a family of four it's $132,000.
If you're close to the line, it pays to look at your income carefully. The Marketplace uses modified adjusted gross income, so things that lower your adjusted gross income, like contributions to a traditional IRA, a health savings account or a self-employed retirement plan, also lower the number the Marketplace sees. Ask a tax professional about your own case.
Early retirees living on savings and self-employed people usually have the most control over where their income lands.
Extra savings on Silver plans
With income from 100% to 250% of the poverty level, Silver plans come with cost-sharing reductions. Your deductible, copays and out-of-pocket maximum go down, and the premium stays the same. The lower your income in that range, the bigger the cut.
You only get these on Silver. A Bronze plan can have a lower premium, but if you qualify for cost-sharing reductions, compare the yearly total before you pass on Silver. Our Obamacare guide explains the metal levels.
Florida's coverage gap
Florida did not expand Medicaid. Adults with income under 100% of the poverty level usually get no tax credit and often don't qualify for Medicaid either. People call this the coverage gap.
If that's you, a few things are worth checking:
- Children may qualify for Medicaid or Florida KidCare even when their parents don't. Applications are taken any time of year.
- Some adults qualify for Florida Medicaid because of pregnancy, a disability or very low income as a parent. You apply through ACCESS Florida.
- If your 2027 income will really be above 100%, from a new job or more hours, use that honest estimate on your application.
- A fixed indemnity plan is an option some people use while they wait. It is not full health insurance. It has no out-of-pocket maximum, health questions apply, and it can pay far below the bill.
How to estimate your 2027 income
The credit is based on what you expect to earn in 2027, not what you earned last year. Use your best honest guess for the whole household.
Count everyone in your tax household: you, your spouse if you file jointly, and anyone you'll claim as a dependent. Married couples generally have to file a joint return to get the credit.
Start from the adjusted gross income on your tax return. Add any tax-exempt interest, untaxed foreign income and the part of Social Security that isn't taxed. If you're self-employed, use net profit after business expenses, not gross sales.
If your income swings from year to year, look at the last year or two, think about what's already lined up for 2027 and pick a realistic number. Then update it when things change.
Reconciliation at tax time
Advance credits are an estimate. When you file your 2027 taxes you complete Form 8962, which compares the credit you received with the credit your real income qualifies for.
If your income came in lower, you may get money back. If it came in higher, you may have to pay back some or all of the difference. Going over 400% of the poverty level means the whole year's credit could be due.
The way to avoid a surprise is to tell the Marketplace when your income or household changes during the year, like a new job, a raise, a marriage or a baby. It adjusts your credit for the months left. Some of those changes also open a Special Enrollment Period to switch plans, and you can set everything up fresh during Open Enrollment.
Common questions
What is the income limit for Obamacare subsidies in Florida in 2027?
400% of the poverty level: $63,840 for one person and $132,000 for a family of four. Above that there's no tax credit for 2027 under the current law.
Can I get a tax credit if my job offers health insurance?
Usually not, if the job coverage counts as affordable and meets the law's minimum standards. If the offer isn't affordable you may qualify, and the Marketplace application asks about it.
Do I have to take the whole credit in advance?
No. You can take all of it, part of it, or none and claim it when you file. Taking less up front lowers the chance of owing money if your income rises.
What if I earn less than 100% of the poverty level?
In Florida you usually won't get a tax credit, and you may not qualify for Medicaid either. Apply through ACCESS Florida anyway, and check Florida KidCare for your children.
Are cost-sharing reductions the same as the tax credit?
No. The tax credit lowers your monthly premium on any metal level. Cost-sharing reductions lower your deductible and copays, only on Silver plans, for incomes from 100% to 250% of the poverty level.