Premium Tax Credit (ACA) Calculator
The Premium Tax Credit (PTC) caps Marketplace health insurance cost as a percentage of household income — currently 0-8.5% depending on Federal Poverty Level. The American Rescue Plan extensions expire end of 2025, returning to pre-ARP cliff at 400% FPL in 2026.
How The Premium Tax Credit Works
The IRS caps your Marketplace health insurance cost at a percentage of income — 0% below 150% FPL, scaling to 8.5% at 400% FPL. The subsidy equals the cost of the second-lowest-cost silver plan minus this capped amount. Subsidy is paid monthly to your insurer (Advanced PTC) or claimed annually on Form 8962.
FPL Thresholds By Household Size 2026
Household of 1: $15,060. Household of 2: $20,440. Household of 3: $25,820. Each additional person: $5,380. Alaska and Hawaii use higher thresholds. The percentage of FPL determines the income cap percentage — 150% FPL pays 0%, 200% FPL pays 2%, 300% FPL pays 6%, 400% FPL pays 8.5%.
American Rescue Plan Extensions Expiring 2025
ARP eliminated the 400% FPL cliff (above which subsidies disappeared) and lowered the 100-150% FPL contribution from 2% to 0%. Inflation Reduction Act extended these through 2025. Without further extension, the cliff returns for 2026 — incomes above 400% FPL receive zero PTC subsidy starting Jan 1, 2026.
Source: 26 USC §36B Premium Tax Credit, Inflation Reduction Act §13002, Healthcare.gov 2026 SLCSP Lookup. Last updated: May 2026.