Skip to content

Do I have to pay back my health insurance tax credit in 2027?

The short answer

Yes, if too much was paid, and there is no longer a limit. Starting with tax year 2026, the return you file in 2027, you repay the full extra amount of premium tax credit sent to your insurer. That can happen when your income ends up higher than you estimated or your household changes and you don't report it.

Updated

Reviewed by the licensed agents at Health Insurance Solutions in Orlando, Florida.

How we research and review

A licensed agent calls you at no cost.

What changed?

If you take the premium tax credit in advance, the marketplace sends it to your insurer each month based on the income you expect. When you file your taxes, you compare those advance payments with the credit you actually qualify for, using Form 8962.

Through tax year 2025, repayment limits capped how much many people had to pay back. The IRS says those limits no longer apply starting with tax year 2026, so you repay the full difference.

How does the repayment work?

At tax time, ifWhat happens
Your advance payments were less than your final creditYou get the difference as a bigger refund or a smaller tax bill.
Your advance payments were more than your final creditYou pay back the full difference. Starting with tax year 2026, there is no cap.
Your household income for the year is above 400% of the federal poverty levelYou qualify for no credit, so you pay back all of the advance payments.

For example, if $4,000 was paid to your insurer during the year and your final credit is $2,500, you owe the $1,500 difference with your tax return.

Which changes should I report to the marketplace?

  • Changes in household income
  • A move to a new address
  • Starting, losing or changing a job
  • Gaining or losing other health coverage, or becoming eligible for it
  • A birth or adoption
  • Marriage or divorce
  • Any other change in who is part of your tax household

Report changes as soon as they happen. The marketplace then adjusts your monthly credit, which lowers the chance of a big bill at tax time.

How can I lower the risk of owing money?

  • Estimate your income for the whole year, including self-employment, side work, bonuses and expected raises.
  • Update your marketplace application whenever your income or household changes, not just at renewal.
  • Use less of the credit in advance. HealthCare.gov lets you use all, some or none of your credit each month, and you get any credit you did not use when you file.
  • Ask a tax professional for help if your income is hard to predict.

Which tax years does this affect?

The change starts with tax year 2026, the return most people file in early 2027, and applies to later years too. Returns for tax year 2025 and earlier keep the old repayment limits.

Compare plans

See our Individual & Family plans

Major medical coverage for you and your household, with subsidies applied where you qualify.
Free tool

2027 health insurance subsidy calculator

Enter your state, household size and income to see your 2027 expected premium, your savings and whether Medicaid may apply.

Talk to a licensed agent

We compare plans, explain the tradeoffs and help you enroll. It costs you nothing.

Get help

Common questions

Is there still a limit on paying back the premium tax credit?

No. Starting with tax year 2026, you must repay the full amount of any extra advance payments. The repayment limits that applied in earlier years no longer apply.

Which tax form do I use?

Form 8962, Premium Tax Credit. You need the Form 1095-A that your marketplace sends you to fill it out.

Can I take less of the tax credit each month?

Yes. You can use all, some or none of your credit in advance. Any credit you did not use comes back to you when you file, as a bigger refund or a smaller tax bill.

What if my income goes up during the year?

Report it to your marketplace as soon as you can so your monthly credit is adjusted. That lowers the amount you might have to pay back.

Sources

Rules change. Confirm dates and eligibility with your marketplace, your state Medicaid agency or Medicare before you enroll.

All articles