2027 Obamacare Income Limits: Who Qualifies for a Premium Tax Credit?

On this page

• What counts as the poverty level for 2027 coverage
• How much of your income you’re expected to pay
• Cost-sharing reductions below 250% of the poverty level
• The 400% cliff
• What counts as income, and what lowers it
• Below 100% of the poverty level
• Will the bigger credits come back?
• Frequently asked questions

What counts as the poverty level for 2027 coverage

Marketplace eligibility for 2027 coverage uses the 2026 federal poverty guidelines. For the 48 contiguous states and DC, the poverty level is $15,960 for one person and $33,000 for a family of four. Alaska and Hawaii use higher figures to reflect their higher cost of living: $19,950 for one person in Alaska and $18,360 in Hawaii.

Household size	100% FPL	250% FPL	400% FPL
1	$15,960	$39,900	$63,840
2	$21,640	$54,100	$86,560
3	$27,320	$68,300	$109,280
4	$33,000	$82,500	$132,000

Medicaid expansion states use 138% of the poverty level as their cutoff for adults: $22,025 for one person and $45,540 for a family of four. Below that, you’re likely eligible for Medicaid rather than a Marketplace subsidy. See health insurance for low-income families.

How much of your income you’re expected to pay

The premium tax credit, a form of subsidy, caps what you pay for the benchmark plan (the second-lowest-cost silver plan in your area) at a percentage of your income. For 2027, the IRS set these percentages:

• Under 133% of the poverty level: 2.15% of income
• 133% to 150%: 3.23% to 4.30%
• 150% to 200%: 4.30% to 6.78%
• 200% to 250%: 6.78% to 8.66%
• 250% to 300%: 8.66% to 10.22%
• 300% to 400%: 10.22%, the highest share anyone pays

Your tax credit covers the difference between that capped amount and the full cost of the benchmark plan. You can put the credit toward any metal-level plan, not only the benchmark one. A cheaper bronze plan might end up costing you nothing, while a pricier gold or platinum plan costs more out of pocket.

Cost-sharing reductions below 250% of the poverty level

If your income is under 250% of the poverty level and you pick a silver plan, you also qualify for cost-sharing reductions, which lower your deductible, copays and coinsurance instead of your premium. The savings step down as income rises:

• 100% to 150% of the poverty level: your silver plan pays about 94% of costs on average
• 150% to 200%: about 87%
• 200% to 250%: about 73%

You only get cost-sharing reductions on a silver plan. Pick bronze or gold instead and you give them up, even if your income would otherwise qualify.

The 400% cliff

Because the bigger credits expired, 2027 brings back the older rule: earn a dollar more than 400% of the poverty level and your premium tax credit drops to zero, with no cap left on what you’d pay above that line.

Say a benchmark plan costs about $625 a month, the 2026 nationwide average for a 40-year-old (2027 premiums run higher in most places). At exactly 400% of the poverty level for one person ($63,840), the 10.22% cap means you’d pay up to about $544 a month, with the credit covering the rest. Earn $200 more a year and the credit disappears entirely, and you pay the full $625. That jump is what people mean by the 400% cliff.

What counts as income, and what lowers it

The Marketplace uses modified adjusted gross income, which for most filers is the same as the adjusted gross income on your tax return. It counts wages, self-employment income, unemployment compensation, retirement and pension income (including taxable 401(k) and IRA withdrawals), both taxable and non-taxable Social Security, capital gains, tips, and alimony from divorces finalized before 2019.

A few things lower that income and can move you into a cheaper bracket or back under the 400% cutoff: contributions to an HSA, tax-deductible contributions to a traditional IRA, and pre-tax contributions to an employer 401(k) or similar plan. One example: a single person expecting $64,500, just over the $63,840 cutoff, could get back under it by putting $1,000 into an HSA. See what an HSA is. If you take more advance credit than you turn out to qualify for, you pay some back at tax time; see do you have to pay back the premium tax credit.

Below 100% of the poverty level

In the 40 states plus DC that expanded Medicaid, adults with incomes up to 138% of the poverty level qualify for Medicaid, and you can apply any time, not only during open enrollment. In the 10 states that haven’t expanded Medicaid, adults below the poverty level often don’t qualify for Medicaid or a Marketplace premium tax credit, which leaves them in what’s called the coverage gap. Georgia and Wisconsin are partial exceptions, covering some adults up to the poverty level through their own programs. For the rules taking effect for Medicaid enrollees generally, see Medicaid work requirements.

Will the bigger credits come back?

The enhanced premium tax credits that ran from 2021 through 2025, which erased the 400% cliff and lowered what everyone owed, expired on December 31, 2025. The House passed a 3-year extension on January 8, 2026, by a vote of 230-196, but the Senate hasn’t taken it up. As of late September 2026, nothing has become law, and the rules described here are current law for 2027.

A stopgap government funding bill passed September 1, 2026 keeps federal funding going only through December 11, 2026, which falls in the middle of open enrollment, so it’s a date worth watching. Nothing about a subsidy deal is settled, but if Congress acts, the rules above could change.

See what you’d pay for 2027 coverage at your income: compare quotes by ZIP code.

Frequently asked questions

What’s the federal poverty level for one person in 2027?

For 2027 premium tax credit eligibility, the poverty level is $15,960 for one person in the 48 contiguous states and DC, $19,950 in Alaska and $18,360 in Hawaii.

Do I get a subsidy if I earn more than 400% of the poverty level?

Not for 2027. The temporary rule that capped premiums at 8.5% of income above 400% expired after 2025. Above that line, you pay the full premium yourself.

Will Congress extend the bigger subsidies before open enrollment starts?

Possibly, but nothing has passed as of late September 2026. The House passed a 3-year extension in January 2026, and the Senate hasn’t voted on it.

What income should I use to estimate my subsidy?

Use your expected 2027 income, not last year’s. Report income and household changes to the Marketplace as they happen so your credit stays accurate; see what happens if you under-report your income.

This article is general information, not insurance, tax or legal advice. Your actual premium tax credit depends on your household’s exact income, size and county. Last reviewed September 2026.