United StatesHealth insurance tax credits would follow an income-based contribution scale
Starting with 2026 tax years, eligible households above 400% of the poverty line could receive health insurance tax credits under an income-based contribution scale.
What it does
Households earning above 400% of the poverty line could qualify for tax credits to help pay health insurance premiums, if they meet other eligibility rules.
The credit calculation would use an expected income contribution of zero for households earning up to 150% of the poverty line, rising to 8.5% at 400% and above.
Argument forUsing a zero income contribution for eligible households near the poverty line could help them afford health insurance premiums.
Argument againstAllowing eligible higher-income households to receive credits could add to the public cost of helping people pay health insurance premiums.
More detail
People earning above 400% of the poverty line could qualify for health insurance premium tax credits. This provision concerns household income used to determine eligibility for the credit. Households would still need to meet other requirements for the tax credit. This provision would apply to tax years beginning after December 31, 2025.
The tax credit calculation would use an income-based scale for the household's expected contribution toward premiums. These percentages would guide the credit calculation; they would not cap the price of every insurance plan. The percentage would rise gradually within each income tier between 150% and 400% of the poverty line. This scale would apply to tax years beginning after December 31, 2025.
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Where it stands
- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Looking ahead
No hearings or votes scheduled.
History
- 2025
- Jan 9Introduced in HouseLatest
- Jan 9Referred to the House Committee on Ways and Means.Introduced
HealthcareTaxes & Budget