Keeping Subsidies Simple
What are premium subsidies?
Advance Premium Tax Credit (APTC) is a program that helps people between 138% and 400% of the Federal Poverty Level pay for their ACA/Obamacare premiums.
Should I apply for them?
If you predict that your 2021 MAGI (think total gross income) will be somewhere between 138% and 400% of the FPL then yes.
What are the Income Guidelines?
Incomes up to 138% may qualify for AHCCCS.
Incomes between 138% and 400% may qualify for Premium Subsidies.
Incomes between 138% and 250% may also qualify for Cost Share Reduction.
What is my MAGI?
What is Cost Share Reduction?
Cost Share Reduction or (CSR) are plans that not only provide large premium subsidies, but also have much lower out of pocket costs.
You must qualify and select a Silver CSR plan to receive both benefits.
How do I best apply?
Keep it Simple! Prior to applying, make your best guesstimate of what your total gross income will be next year, and be ready to tell me how you arrived at that number. I will take care of the rest.
How do they verify my "future" income?
When you file your 2021 taxes the IRS will reconcile your predicted future income on our application with what they have determined it to actually be after reviewing your taxes.
If we predicted a lower income than they determine upon reviewing your filed 2021 1040 taxes, they will recover any overages you were previously paid.
If we predicted too high, then they will credit you with the additional amount of premium subsidy you were eligible for.
TIP - Contact me to update your predicted income during the year if you find that you are deviating from your originally predicted income. Our goal is a zero sum game, or at least to come as close as possible.