The cliff is back. Find your edge.

What this calculator does#

The Affordable Care Act's Premium Tax Credit (PTC) is a refundable federal subsidy that pays part of a household's marketplace health-insurance premium. Eligibility and amount are controlled by 26 U.S.C. § 36B and 26 C.F.R. § 1.36B-3, and are pegged to the household's Modified Adjusted Gross Income (MAGI) as a percentage of the federal poverty level (FPL). For plan year 2026, IRS Rev. Proc. 2025-25 restores the pre-ARPA hard cliff: a household with MAGI one dollar above 400% of FPL receives no PTC at all.

The calculator above takes your filing status, household size, state, itemized income, and above-the-line adjustments, and returns four numbers that matter: your MAGI as a percentage of FPL, your applicable percentage from the §36B(b)(3)(A) table, your annual PTC in dollars, and your distance to the cliff. It then ranks the MAGI moves — HSA contribution, deductible IRA, SEP-IRA or Solo 401(k), self-employed health insurance deduction — that would pull you back under the threshold, sized to the credit they would recapture.

How it computes your PTC#

The Premium Tax Credit is the difference between the second-lowest-cost Silver plan (SLCSP) available to your household and what § 36B calls your required contribution, floored at zero:

PTC_annual = max(0, SLCSP_annual − applicablePct × MAGI)

Four inputs drive that formula. MAGI is defined at 26 U.S.C. § 36B(d)(2)(B): adjusted gross income plus tax-exempt interest, plus the non-taxable portion of Social Security benefits, plus any foreign earned income excluded under § 911. The calculator accepts all three above-AGI additions as explicit fields rather than rolling them silently into AGI.

FPL comes from the HHS ASPE Poverty Guidelines, scaled by household size and region (contiguous 48 + DC, Alaska, Hawaii). Per § 36B(d)(2)(B), the PTC uses the prior-year guidelines, so tax year 2026 calculations use the 2025 ASPE table (Federal Register 90 FR 5917). Household size includes everyone in your tax household, even members covered by Medicare or employer plans.

The applicable percentageis a function of MAGI as a percentage of FPL, published annually by the IRS via revenue procedure. For 2026 that's Rev. Proc. 2025-25, which sets a bracketed table from 2.10% (at 100% FPL) up to 9.96% (at the 300%–400% FPL ceiling) with nothing above the cliff. Within each bracket the calculator linearly interpolates between the bracket's initial and final percentages.

The SLCSP is the second-cheapest Silver plan in your rating area at your age. The calculator uses state-level age-band averages aggregated from KFF and CMS rate-filing public-use files, interpolated between five reference ages (21, 30, 40, 50, 60). The full derivation and the side-by-side cliff/smoothed applicable-percentage tables are on the methodology page.

The cliff vs the smoothed regime#

The original ACA (2010) capped PTC eligibility at 400% FPL with no taper: cross the line by a dollar and you lost the entire credit. The American Rescue Plan Act (2021) and the Inflation Reduction Act (2022) replaced that hard cliff with a smoothed applicable-percentage curve that capped any household's required contribution at 8.5% of MAGI, regardless of how far above 400% FPL the household sat. Those enhancements expired 2025-12-31. For plan year 2026, IRS Rev. Proc. 2025-25 publishes a §36B(b)(3)(A) table with no row above 400% FPL — the pre-ARPA cliff is back, by operation of law.

The planning consequence is severe. Under the cliff regime, a household at 399% FPL with a $1,500/month SLCSP receives roughly $10,000 a year in PTC; the same household at 401% FPL receives nothing. A $200 difference in projected MAGI can mean a $10,000 swing in net insurance cost — a marginal tax rate, on that last dollar, of several thousand percent. Under the smoothed regime, the same household above 400% FPL would still owe no more than 8.5% of MAGI in premium, so PTC tapers continuously rather than vanishing.

The calculator defaults to the cliff regime because that is the law for 2026 as of the last update on this page. If Congress passes an extension and it applies retroactively to TY2026, the site's regime flag flips and every output, copy block, and ranked recommendation adapts automatically. The side-by-side applicable-percentage tables on the methodology page show exactly what changes.

What the calculator approximates#

The cliff-distance math — MAGI compared against 400% of your household's FPL — is exact. The PTC dollar value is a bounded estimate because the SLCSP itself is estimated. A few edge cases are worth naming explicitly so you can decide when to trust a number and when to verify against your zip code on healthcare.gov or your state-based marketplace.

SLCSP precision. The benchmark plan is set at the rating-area level, not the state level. State age-band averages mask zip-level variation that routinely runs ±20% to ±30% — sometimes more in states with sharp urban/rural rate splits. For PTC dollars, verify the SLCSP for your specific zip on healthcare.gov before making decisions sized in thousands of dollars.

Medicaid expansion flips the answer below 138% FPL. In the 41 expansion states plus DC, households under 138% FPL route to Medicaid rather than to marketplace PTC. In the nine non-expansion states without a § 1115 waiver — Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, and Wyoming — adults below 100% FPL fall into the coverage gap (Wisconsin is the special case: no formal expansion, but BadgerCare covers adults to 100% FPL via § 1115 waiver). The calculator routes to a Medicaid-likely panel or a coverage-gap panel as appropriate. The states directoryspells out each state's posture.

Family-glitch fix. The 2022 regulatory fix at 26 C.F.R. § 1.36B-2(c)(3)(v) changed the affordability test for family members of an employee offered employer coverage. The calculator applies the fix at the household level but does not model every per-member combination of dual-spouse employer offers. State subsidy backfills — the additional credits California, New York, New Jersey, Massachusetts, Washington, and Vermont layer on top of the federal PTC for low- and middle-income marketplace households — are not modeled; check your state marketplace directly. Self-employed health insurancededuction circularity (IRS Pub 974 Worksheet W) is handled iteratively when SE income is present.

Worked example#

Consider a self-employed couple in Florida (a non-expansion state), household size 2, both age 50, with a projected 2026 MAGI of $80,300. The 2025 FPL for a household of 2 in the contiguous 48 is $21,150; 400% of FPL is $84,600. At $80,300, the couple sits at roughly 380% of FPL — inside the eligibility band but close to the cliff.

Under the 2026 cliff-regime applicable-percentage table, MAGI at 380% FPL maps to roughly 9.96% (the table is flat across the 300%–400% bracket). At a Florida SLCSP for two 50-year-olds of roughly $1,500/month — $18,000 a year — the required contribution is 9.96% × $80,300 = $7,998. PTC is therefore $18,000 − $7,998 = $10,002 for the year, or about $834 a month off the marketplace bill.

Now nudge MAGI to $84,700 — $100 above 400% FPL. The applicable-percentage table has no row above the cliff. The PTC drops to zero. The couple has lost $10,002 of subsidy over a $400 change in income: an effective marginal tax rate of about 2,500% on the dollars that pushed them across. The cliff distance the calculator displays — here, $4,300 — is the buffer before this happens.

MAGI moves that recapture the credit if a year-end projection puts the couple above $84,600: a deductible Traditional IRA contribution (each spouse, if eligible based on income type and active-plan status), an HSA contribution if either spouse is on a qualifying high-deductible plan, a Solo 401(k) or SEP-IRA deferral for the self-employed earner, and the iterative SEHI deduction. Each is ranked in the calculator output by dollar value of PTC recaptured. The scenarios librarywalks through this and a dozen sibling situations end to end.

What this is not#

This calculator is editorial and analytical. It is not tax advice, financial advice, legal advice, or insurance advice. It cannot tell you whether to do a Roth conversion this year, which specific marketplace plan to enroll in, whether a particular broker is right for you, or how to interpret your own Form 1095-A. The math is built on primary sources cited on the methodology page and defined on the glossary page; common questions are answered on the FAQ.

For decisions that turn on facts the calculator doesn't see — your full return, your actual rating-area SLCSP, the state-specific Medicaid posture you may have just become eligible for — talk to a CPA, an enrolled agent, or a state-marketplace-certified enroller. The marketplace enrollers are free. Our editorial standards, funding, and corrections policy are described on the about page.