When you apply for health coverage and financial help from Vermont Health Connect, you will be asked to estimate your income for the upcoming year. One type of financial help is called “premium tax credits.” Premium tax credits can be taken in advance during the year to reduce your health insurance premiums.
If you qualify, you can choose to take your premium tax credits either:
- In advance, so you pay less each month for your health insurance premium;
- At the end of the year when you file your taxes; or
- Part in advance, and part at the end of the year when you file taxes.
When you take premium tax credits before you file your federal income taxes, they are called “advance premium tax credits”, or APTC. Estimating your income in advance can be tricky—especially if your income changes during the year. IMPORTANT - report any change in your income.
If your total yearly income at the end of the year is more than you expected, you may have to pay back some of your premium tax credits when you file your federal income taxes. Your household size and income might limit the amount you have to repay (see tables below).
| Tax Year 2024 Repayment Limits for Advance Premium Tax Credits | ||||
| Household Income as a Percentage of Federal Poverty Level (FPL) | Annual Income for an Individual | Maximum Repayment for a Single Person | Annual Income for a Family of Four | Maximum Repayment for Married Taxpayers Filing Jointly |
| <200% | <$29,160 | $375 | <$60,000 | $750 |
| 200-299% | $29,160 - $43,739 | $950 | $60,000 - $89,999 | $1,900 |
| 300-399% | $43,740 to $58,319 | $1,575 | $90,000 to $119,999 | $3,150 |
| 400%+ | $58,320 | Full Amount | $120,000 | Full Amount |
| Tax Year 2023 Repayment Limits for Advance Premium Tax Credits | ||||
| Household Income as a Percentage of Federal Poverty Level (FPL) | Annual Income for an Individual | Maximum Repayment for a Single Person | Annual Income for a Family of Four | Maximum Repayment for Married Taxpayers Filing Jointly |
| <200% | <$27,180 | $350 | <$56,000 | $700 |
| 200-299% | $27,180 - $40,769 | $900 | $56,000 - $83,249 | $1,800 |
| 300-399% | $40,770 to $54,359 | $1,500 | $83,250 to $110,999 | $3,000 |
| 400%+ | $54,360 | Full Amount | $111,000 | Full Amount |
Report Every Income Change
Your financial help, also known as Advance Premium Tax Credits (APTC), is based on the information you give us. Please report income changes to Vermont Health Connect when they happen to ensure you are getting the correct benefits. If you report an income increase during the year, you may have something called “APTC exhaustion”. When you have APTC exhaustion, Vermont Health Connect will adjust your monthly APTC amount to help you avoid owing money back when you file and reconcile your federal income taxes. It also means your monthly premium bill will be higher because you're getting less financial help.
You can also choose to pay your full monthly premium each month through the end of the year. That way, you can claim all your premium tax credits at once when you file your federal taxes.
The following worksheets(s) can be used to estimate the amount of Advance Premium Tax Credits (APTC) you may get for the plan year. Please note, the use of this worksheet is to inform what your APTC and/or APTC exhaustion may be. Final APTC and APTC exhaustion calculations are determined by Vermont Health Connect. You will need to download and save the worksheet to your computer.
If your employer offers you a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) to help lower your household’s health care costs, you can reduce the amount of APTC you get by the amount of the QSEHRA. When Vermont Health Connect asks how much APTC you want to use to lower your monthly premium, subtract your monthly QSEHRA amount from your total APTC amount. This will help you avoid owing money when you file taxes.