Yes, you can still claim the Premium Tax Credit (PTC) even if your coverage changes during the tax year. However, changes in your circumstances may affect the amount of Advance Premium Tax Credit (APTC) paid on your behalf and the amount of PTC you are ultimately allowed when you file your tax return. The Marketplace determines APTC based on projected income and household information at enrollment, while the final PTC is based on your actual income, tax family size, and coverage for the year.
Changes You Must Report
Changes that can affect your PTC include:
- Changes in household income
- Moving to a different address
- Gaining or losing eligibility for other health care coverage
- Gaining, losing, or changes to employment
- Birth or adoption
- Marriage or divorce
- Other changes affecting the composition of your tax family
Reporting these changes to the Marketplace allows adjustments to APTC so it more closely matches the PTC you are allowed. If changes are not reported, the APTC paid may be too high or too low, resulting in a balance due or additional credit when you file your return.
Reconciliation on Form 8962
When filing your tax return, you must use Form 8962 to reconcile the APTC received with the actual PTC you are eligible for. This reconciliation is based on information provided in Form 1095-A.
If your coverage, tax family, or location changed during the year, the Second Lowest Cost Silver Plan (SLCSP) amount shown on Form 1095-A may not reflect the correct amount for each month. In such cases, you must determine the correct SLCSP for each affected month using guidance from Publication 974.
Monthly Calculation Requirement
If your coverage, household, or other relevant factors changed during the year, you generally must compute the PTC on a monthly basis by completing Part II (Lines 12–23) of Form 8962. The simplified annual calculation (Line 9) is only available if the required conditions are met for the entire year.
Important Considerations
- The PTC is based on your actual annual income and tax family information
- Excess APTC may need to be repaid (subject to repayment limitations)
- If APTC is less than the allowable PTC, you may claim the difference as a credit
- Reporting changes during the year helps reduce large adjustments at filing
Source:
Publication 974
Form 8962
Disclaimer: Always verify details with current Federal or State Department of Revenue Forms and Instructions. For complex situations, consult a tax professional or attorney.