Over the ACA Income Limit for 2027? What the 400% Line Means

Federal law makes a household eligible for the premium tax credit when its income is at least 100% and not more than 400% of the federal poverty level. The enhanced credits that suspended that top limit ended on December 31, 2025, so the limit applies again.

The Kansas Health Institute notes that the 2025 federal budget law did not extend the enhanced credits, and that they ended on December 31, 2025. The IRS's 2027 table in Rev. Proc. 2026-26 reflects this: its top band is household income of at least 300% but not more than 400% of the poverty level. HealthCare.gov's glossary likewise lists the range as income between 100% and 400% of the poverty level.

It is a line, not a slope. Under the statute the credit is for household income that does not exceed 400% of the poverty line, so a household just over it does not receive a smaller credit; it receives none. That is why the estimate you give the Marketplace deserves care when your income is close.

For 2027 coverage the Marketplace uses the 2026 federal poverty guidelines, the ones in effect when Open Enrollment begins. In the 48 contiguous states and D.C. that is $15,960 for one person, with $5,680 added for each additional person, so 400% is $63,840 for one person.

Worked out from the HHS table (91 FR 1797), 400% comes to $63,840 for a household of one, $86,560 for two, $109,280 for three and $132,000 for four. Each added person adds $22,720. Alaska and Hawaii have higher guidelines, so their lines are higher. These are income lines for the year, counted as described below, not a promise of any particular credit.

The Marketplace uses modified adjusted gross income, or MAGI. HealthCare.gov defines it as your adjusted gross income plus any untaxed foreign income, non-taxable Social Security benefits and tax-exempt interest. For many people it is the same as or very close to adjusted gross income.

HealthCare.gov asks for your expected household income for the year you want coverage, not last year's income, and says to make your best estimate. Counted income includes items such as wages, investment income and capital gains, along with taxable and non-taxable Social Security. Child support, gifts and Supplemental Security Income are not counted. If your income changes during the year, you can update your application, and HealthCare.gov asks you to report changes as soon as possible.

Advance payments of the credit are based on your estimate and are reconciled when you file your taxes. Beginning with the 2026 tax year, federal law removed the old caps on how much of an excess advance credit must be repaid, so an estimate that is too low can mean repaying more at tax time.

The Kansas Health Institute reports that the 2025 budget law removed the cap on the amount consumers must repay, effective for the 2026 tax year, and the statute's current text no longer carries the cap for households under 400% of the poverty level. An estimate that is too high can also cost you, because you may pay more each month than you needed to, and you would wait until your return to see it settled. The goal is simply your most honest number, updated when life changes. Our guide to how ACA premium tax credits work explains the calculation, and self-employed health insurance covers income that moves around.

Because MAGI starts from adjusted gross income, certain tax deductions that lower adjusted gross income also lower MAGI. HealthCare.gov's glossary names deductions for conventional IRA contributions and student loan interest, and the IRS says you can deduct your own contributions to a health savings account.

That is general information, not advice. Each of those has its own eligibility rules, contribution limits and deadlines, and saving more for retirement or health costs is a financial decision with trade-offs of its own. Some households will find these adjustments change their estimate; many will find they make no difference. Never leave income off an application to reach a number: report what you expect, and let the legitimate deductions do their work on the tax return.

Please talk to a tax professional about your own situation. Empathy Insurance Advisors is not a real estate, tax, or financial planning firm, and a licensed insurance agent cannot tell you how to file.

The 400% line limits the premium tax credit. It is not a limit on shopping for a Marketplace plan. Over the line, you compare plans at their full premium, so the work shifts to matching a plan's premium, deductible and network to how you actually use care.

Open Enrollment for 2027 coverage runs November 1, 2026 through January 15, 2027 on HealthCare.gov, and December 15, 2026 is the last day to choose a plan that starts January 1. Compare a few metal levels rather than defaulting to the one you have, and check your doctors and medications against each plan. Our metal tier guide and Open Enrollment overview are good places to start.

Alexander James is a licensed independent insurance agent. He can help you estimate household income the way the Marketplace counts it, compare the plans offered in your county, and complete the application. There is no obligation to enroll.