The premium tax credit closes the gap between what the benchmark marketplace plan costs and what a household is expected to pay based on income.
How it works
The credit equals the benchmark (second-lowest-cost Silver) plan’s annual premium minus a required contribution, which is household income multiplied by an “applicable percentage” set by the current year’s income-bracket schedule.
What this does not include
The applicable percentage schedule has changed repeatedly by law — enhanced pandemic-era subsidies expired and pre-2021 rules resumed for 2026, per HealthCare.gov. Rather than hardcode a bracket table that would go stale on the next law change, this calculator takes the applicable percentage as a direct input from the current year’s published bracket.
How to use this calculator
- Look up your area’s benchmark Silver plan annual premium and your applicable percentage for your income level.
- Enter both, along with your household income.
Frequently asked questions
Where do I find my applicable percentage?
HealthCare.gov and the IRS publish the current year’s income-to-percentage schedule; the correct bracket depends on household income as a percentage of the federal poverty level.
Can the credit exceed the benchmark premium?
No — it’s floored at $0 on the low end and capped at the full benchmark premium on the high end; this calculator applies both bounds.
Does the credit have to be used on the benchmark plan?
No — the dollar credit amount can be applied to any marketplace plan, though it’s calculated against the benchmark Silver plan’s premium specifically.
