You are not eligible for the premium tax credit for coverage purchased outside the Marketplace. Use the "Am I Eligible to Claim the Premium Tax Credit" interview tool to see if you may qualify for the premium tax credit.
2021 Unemployment Compensation. If you, or your spouse (if filing a joint return), received, or were approved to receive, unemployment compensation for any week beginning during 2021, the amount of the your household income is considered to be no greater than 133% of the federal poverty line for your family size and you are considered to have met the household income requirements for being allowed a premium tax credit.
2021 and 2022 Premium Tax Credit Eligibility. For tax years 2021 and 2022, the American Rescue Plan of 2021 (ARPA) temporarily expanded eligibility for the premium tax credit by eliminating the rule that a taxpayer is not allowed a premium tax credit if his or her households income is above 400% of the Federal Poverty Line.
To be eligible for the premium tax credit, your household income must be at least 100 percent and, for years other than 2021 and 2022, no more than 400 percent of the federal poverty line for your family size, although there are two exceptions for individuals with household income below 100 percent of the applicable federal poverty line. Remember that simply meeting the income requirements does not mean you're eligible for the premium tax credit. You must also meet the other eligibility criteria.
For information about the two exceptions for individuals with household income below 100 percent of the federal poverty line, see the instructions to Form 8962.
Here are some things to remember about how your household income affects your premium tax credit:
See the instructions to Form 8962, Premium Tax Credit (PTC), for information about the federal poverty guidelines for purposes of claiming the premium tax credit.
The federal poverty guidelines are sometimes referred to as the "federal poverty line" or FPL. The Department of Health & Human Services (HHS) determines the federal poverty guideline amounts annually.
HHS provides three federal poverty guidelines: one for residents of the 48 contiguous states and Washington D.C., one for Alaska residents, and one for Hawaii residents. For purposes of the premium tax credit, eligibility for a certain year is based on the most recently published set of poverty guidelines at the time of the first day of the annual open enrollment period for coverage for that year. Consequently, the federal poverty guidelines published in January of 2020 are used for premium tax credit eligibility for 2021.
Taxpayers are reminded to keep supporting documents about their income, including any supporting documentation received from their state concerning their receipt of or approval for unemployment compensation, with their tax records.
Filing electronically is the easiest way to file a complete and accurate tax return. Electronic filing options include free volunteer assistance, IRS Free File, commercial software and professional assistance.
Aside from your income, there are other factors that affect the credit amount, including:
If you are married and you file your tax return using the filing status married filing separately, you will not be eligible for the premium tax credit unless you are a victim of domestic abuse and spousal abandonment and can meet certain criteria. Details regarding this relief are in the instructions for Form 8962 and Publication 974.
Generally, a taxpayer who lives apart from his or her spouse for the last six months of the tax year is considered unmarried if the taxpayer files a separate return, maintains a household that is also the main home of the taxpayer's dependent child for more than half the year, and furnishes more than half the cost of the household during the tax year.