TaxGuyBill
Level 15

Unfortunately, the Premium Tax Credit is NOT based on the income of those who have it.  It is based on the Household Income, regardless of other people are covered by other insurance or Marketplace insurance.  So you can't exclude his income from the calculation, unless they file as MFS.

As Lisa said, there is an "alternative" method of calculating things for the year of marriage (see the box right above line 9 of the 8962).  Although it does reduce the repayment in some circumstances, unfortunately other times it does not reduce it.

You should test the results of MFS.  That MIGHT limit the repayment, but it could possibly increase the tax on other parts of the tax return.  If they are interested in contributing to a deductible Traditional IRA, that may also reduce the repayment of the Advance Credit.

View solution in original post