How it works
Under the Affordable Care Act, marketplace plans are priced as a share of your income, with the federal government paying the difference between that cap and the benchmark silver plan premium. The calculator finds your household's income as a percentage of the federal poverty level (using the 2026 HHS guideline of about $15,650 for one person plus $5,580 per additional person), applies a simplified contribution scale — roughly 2% of income at the lowest tier up to about 8.5% near 400% FPL — and estimates the monthly subsidy as benchmark premium minus your share. On the defaults ($52,000 MAGI, household of 2, $800 benchmark premium) income sits near 245% of FPL, your expected share is about $273/month, and the estimated subsidy is about $527/month, leaving a $273 net premium. Two subtleties matter: the subsidy is calculated on the second-lowest-cost silver plan, not the plan you actually pick (cheaper plans can cost less than the cap; richer plans cost more), and the number is an estimate — final eligibility depends on the exchange, your state, and Form 8962 reconciliation at tax time. Underestimating income can mean repaying credits when you file.
Formula
Monthly contribution = (MAGI × contribution %) / 12 | Subsidy = max(0, benchmark premium − contribution)
Tips
- Project current-year MAGI carefully — underestimating can mean repaying subsidies at tax time via Form 8962.
- The subsidy applies to the benchmark silver plan; bronze plans are often cheaper than your contribution cap.
- Report life changes (a new job, a baby) within 30 days — subsidy eligibility is not set-and-forget.
- Silver plans with cost-sharing reductions are worth comparing for households under 250% FPL.
Frequently asked questions
- Am I eligible for a health insurance subsidy?
- If your household income is between roughly 100% and 400% of the federal poverty level and you buy through the marketplace (and you are not offered affordable employer coverage), you likely qualify for a premium tax credit. Under 100% FPL, Medicaid rules differ by state.
- What is the benchmark plan?
- The second-lowest-cost silver plan in your area. Your subsidy is calculated against its premium; choosing a cheaper plan can drop your net cost below the contribution cap, and a pricier plan means you pay the difference yourself.
- Why does the default example show about $527?
- At $52,000 MAGI for a household of two (~245% FPL) the simplified scale expects you to pay about 6.3% of income annually — roughly $273 a month. Against an $800 benchmark premium that leaves an estimated $527 monthly credit. Change income or premium and the gap moves with it.
- What if my income changes mid-year?
- Update your marketplace application within 30 days of any change — a raise, a lost job, a marriage. Subsidy amounts are reconciled on your tax return, and underpaying estimates can create a repayment owed at filing.
- Do I have to repay the subsidy if my estimate was wrong?
- It depends how far the estimate missed and your final FPL band. Small errors at lower incomes are often capped; larger discrepancies are reconciled at tax time. Conservative income estimates that err upward are safer than optimistic ones.