So you signed up for a Covered California health plan, snagged a sweet premium tax credit, paid your first premium, got those shiny medical cards, and now you're thinking everything's smooth sailing. Well, there's one more thing you gotta keep an eye on-your household income. If it changes during the year, you need to report it within 30 days. What happens if you don't?
If your income turns out to be higher than expected, it means if you were cruising along all year with APTC based on a lower income, you actually got too much help and now you gotta pay it back. The good news is, there's a limit to how much you'll owe based on your annual household income.
If your income ends up lower than anticipated, you'll get a refund when you file your taxes. That's right, any premium assistance you were eligible for but didn't receive will find its way back to you. Just make sure you file your taxes on time to snag those tax credits that are rightfully yours.
Will you have to repay your APTC?
If your income drops below 138% of the Federal Poverty Level and you become eligible for Medi-Cal? Will you still have to repay your APTC? Covered California's got an answer for you: "Generally, no." If you reported your income as eligible for premium assistance and later qualify for Medi-Cal, you won't have to return the premium assistance you received. But you gotta report that income change within 30 days, otherwise, there could be some consequences. So, don't procrastinate, report that change ASAP.
How do you report a change?
Log into your Covered California account, find the "Report a Change" button, and spill the beans. If you don't have an account yet, no worries. You can create one with your very own username and password and link it to your existing account. And if you're feeling a bit lost or have questions buzzing in your head, we're here to help as your trusty health insurance agent. Just give us a call at 1-877-752-4737, and we'll sort you out.
And one more thing to keep in mind: If you have IRS tax questions regarding how the Affordable Care Act will impact you and your taxes, check out www.irs.gov/aca for some answers.
