Does Your Employer Offer Coverage?
The third hurdle is a tricky one – you must not have access to an employer-sponsored medical plan that provides “minimum coverage” and is “affordable”. If you don’t have an employer-sponsored plan available to you, then you pass this hurdle. If you do have coverage available through your employer, you’ll have to determine if your employer–provided plan provides “minimum coverage” and is “affordable”. These are defined below:
- “Minimum” coverage means the plan would have to
pay for at least 60% of all care you receive (also called
a Bronze level plan). Most plans meet this minimum.
- “Affordable” coverage means the plan costs you less
than 9.5% of your household income for just your
single employee premium.
Two Common Questions
Q1: If I do not qualify for the subsidy, can my spouse and children still qualify?
A1: Unfortunately, no. This is an IRS rule. Even if your employer plan is not affordable for your family members, they will still not be eligible for a Federal subsidy.
Q2: What if I get a subsidy and it turns out when I do my taxes that I should not have received it?
A2: The subsidy is treated like an advance. When you file your tax return, you will have to calculate whether or not you were eligible for the subsidy. If you received too much, you will have to pay it back when you file your return. If you received too little, you will receive an additional credit when you file your return.