If you buy health insurance through HealthCare.gov or a state marketplace, the premium tax credit 2027 rules are stricter than what many people got used to from 2021 through 2025. The enhanced subsidies expired at the end of 2025, so the credit once again generally stops at 400% of the federal poverty level, which is $63,840 for a single person and $132,000 for a family of four for 2027 coverage. You will also have to pay back any excess advance credit in full at tax time, with no repayment cap. Open enrollment for 2027 coverage begins November 1, 2026, so now is the time to estimate your income carefully.
What Changed for the Premium Tax Credit in 2027
Several federal changes stack together for 2027 coverage:
- The “subsidy cliff” is back. The pandemic-era enhancements, which removed the 400% income cap and lowered required contributions, expired at the end of 2025. For 2027, the credit is generally available only to households between 100% and 400% of the poverty level.
- Higher required contributions. The IRS published the 2027 applicable percentages in Rev. Proc. 2026-26. Expected contributions now range from 2.15% to 10.22% of household income.
- No repayment cap. Starting with tax year 2026, taxpayers must repay the full amount of any excess advance premium tax credit.
- Tighter eligibility for some noncitizens. Beginning in 2027, proposed rules would restrict eligibility to U.S. citizens, U.S. nationals, and certain lawfully present noncitizens, with stronger verification of advance payments.
Premiums themselves are also rising. Families USA reports that insurers’ proposed 2027 increases average nearly 15%, the second straight year of double-digit increases, and that the share of enrollees choosing bronze or catastrophic plans rose to 40% in 2026 from 30% in 2025. If you qualify for the credit, it absorbs much of a benchmark premium increase, because your expected contribution is tied to income rather than to the price of the plan. If you are over the income limit, you bear the full increase.
Premium Tax Credit 2027 Income Limits
For 2027 coverage, marketplaces use the 2026 federal poverty guidelines. The table below uses the HHS figures for the 48 contiguous states and D.C. (Alaska and Hawaii have higher guidelines.)
| Household size | 100% of poverty level | 400% of poverty level (approx. upper limit) |
| 1 | $15,960 | $63,840 |
| 2 | $21,640 | $86,560 |
| 3 | $27,320 | $109,280 |
| 4 | $33,000 | $132,000 |
Income here means modified adjusted gross income (MAGI) for your tax household, which generally starts with AGI and adds back items such as tax-exempt interest and the non-taxable portion of Social Security benefits. Earning even $1 over the 400% line can eliminate the credit entirely, which is why it is called a cliff.
Note that the 2027 numbers are higher than the limits used for 2026 coverage, which were based on the 2025 guidelines (400% was $62,600 for a single person, per Families USA). Early retirees should pay special attention to how retirement income counts. Traditional IRA and 401(k) withdrawals, pension income, and capital gains all add to MAGI, and the non-taxable part of Social Security is added back. Our overview of how retirees are taxed in 2026 explains which income sources are taxable.
How Much You Are Expected to Pay: The 2027 Percentages
The credit equals the cost of the second-lowest-cost silver plan in your area (the “benchmark” plan) minus your expected contribution. Your expected contribution is a percentage of your income, set each year by the IRS. Here is the 2027 applicable percentage table:
| Household income (% of poverty level) | Expected contribution (% of income) |
| Under 133% | 2.15% |
| 133% to under 150% | 3.23% to 4.30% |
| 150% to under 200% | 4.30% to 6.78% |
| 200% to under 250% | 6.78% to 8.66% |
| 250% to under 300% | 8.66% to 10.22% |
| 300% to 400% | 10.22% |
Within each band, the percentage rises gradually with income. The same Rev. Proc. sets the 2027 employer coverage “affordability” percentage at 10.22%. If your employer offers affordable self-only coverage, you generally can’t get the premium tax credit for marketplace coverage.
Simple example
A single person with 2027 MAGI of $31,920 is at 200% of the poverty level, so the expected contribution is 6.78% of income, about $2,164 for the year, or roughly $180 a month. If the benchmark silver plan costs $600 a month (a hypothetical figure; actual premiums vary widely by location and age), the credit would be about $420 a month. At $65,000 of income, the same person would be above 400% and would generally get no credit.
Full Repayment: Why Your Income Estimate Matters More Than Ever
Most people take the credit in advance, paid directly to the insurer, based on an income estimate. When you file your return, you reconcile the advance payments with your actual credit on Form 8962. Under prior law, many lower- and middle-income households had a cap on how much they had to repay. That cap is gone. According to the IRS, starting with tax year 2026, you must repay the full amount of any excess advance payments.
That makes a few groups especially vulnerable:
- Self-employed people and gig workers whose income swings from year to year. Our guide to 2026 self-employment taxes explains how net earnings are figured.
- Early retirees who take IRA withdrawals, Roth conversions, or capital gains that push MAGI over 400%.
- Households with changes such as marriage, divorce, a new job, or a child moving out.
The IRS recommends reporting income and household changes to the marketplace promptly so your advance payments can be adjusted during the year. If you are unsure, consider taking less than the full advance credit and claiming the rest when you file. That trades a bit of monthly cash flow for protection against a large balance due in April.
Open Enrollment Dates for 2027 Coverage
| Date | What happens (HealthCare.gov states) |
| November 1, 2026 | Open enrollment begins |
| December 15, 2026 | Last day to enroll for coverage starting January 1, 2027 |
| January 15, 2027 | Open enrollment ends; coverage starts February 1 |
These are the HealthCare.gov dates. States that run their own exchanges set their own deadlines, and some differ from the federal calendar (The Kory Agency), so check your state’s marketplace.
Tax Moves That Can Help You Keep the Credit
Because the credit depends on MAGI, lowering MAGI can protect eligibility, especially for households near 400%:
- Contribute to a traditional 401(k) or deductible IRA, which reduces AGI.
- Fund a health savings account if you choose an HSA-eligible plan. See our post on 2027 HSA contribution limits.
- Time capital gains, Roth conversions, and IRA withdrawals so they don’t push you over the cliff in a coverage year.
- Self-employed? Retirement plan contributions and the deduction for half of self-employment tax both reduce AGI.
If you are turning 65 soon, marketplace coverage generally gives way to Medicare. Our guide to Medicare open enrollment for 2027 covers costs and timing.
Frequently Asked Questions
What is the income limit for the premium tax credit in 2027?
Generally 400% of the federal poverty level: about $63,840 for a single person and $132,000 for a family of four in the 48 contiguous states, based on 2026 HHS guidelines.
Do I have to pay back the premium tax credit if my income goes up?
Yes. Beginning with tax year 2026, there is no cap on repayment. If your actual income results in a smaller credit than the advance payments you received, you repay the full difference on your tax return.
Did the enhanced ACA subsidies get extended?
No. The enhanced credits expired at the end of 2025, and the 2027 percentages published by the IRS reflect the original ACA structure.
When is open enrollment for 2027 health insurance?
On HealthCare.gov, November 1, 2026 through January 15, 2027. Enroll by December 15 for coverage starting January 1.
Get Help Estimating Your 2027 Income
With the cliff back and no repayment cap, a careful income projection can be worth thousands of dollars. If you want help estimating your MAGI or planning retirement withdrawals around your coverage, book a free consultation with Aric at CPA Solutions.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
