Terms You May Need To Know — 2025 Inst 8962 (PDF)

Tax family. For purposes of the PTC, your tax family consists of the following individuals.

c. The portion of the enrollment premiums (described later) for the month for which you are responsible was paid by the due date of your tax return ( not including extensions), the entire premium is covered by APTC, or the amount of the premium paid for the month is sufficient to avoid termination of the individual's coverage for that month under one of the scenarios described under Enrollment premiums, later. However, if you became eligible for APTC because of a successful eligibility appeal and you retroactively enrolled in the plan, then the portion of the enrollment premium for which you are responsible must be paid on or before the 120th day following the date of the appeals decision.

You, if you file a tax return for the year and you can’t be claimed as a dependent on someone else’s 2025 tax return.

Your family size equals the number of qualifying individuals in your tax family (including yourself). See

Your spouse if filing jointly and your spouse can’t be claimed as a dependent on someone else’s 2025 tax return.
Your dependents whom you claim on your 2025 tax return. If you are filing Form 1040-NR, you should include your dependents in your tax family only if you are a U.S. national; a resident of Canada, Mexico, or South Korea; or a resident of India who was a student or business apprentice.

No one can claim you as a dependent for the year.

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Line 1 , later, for more information on figuring your tax family size.

Note: Listing your dependent by name and social security number (SSN) or individual taxpayer identification number (ITIN) on your tax return is the same as claiming them as a dependent. If you have more than four dependents, see the Instructions for Form 1040 or the Instructions for Form 1040-NR.

Household income. For purposes of the PTC, household income is the modified adjusted gross income (modified AGI) of you and your spouse (if filing a joint return) (see Line 2a, later) plus the modified AGI of each individual whom you claim as a dependent and who is required to file an income tax return because their income meets the income tax return filing threshold (see Line 2b , later). Household income does not include the modified AGI of those individuals whom you claim as dependents and who are filing a 2025 return only to claim a refund of withheld income tax or estimated tax.

Modified AGI. For purposes of the PTC, modified AGI is the AGI on your tax return plus certain income that is not subject to tax (foreign earned income, tax-exempt interest, and the portion of social security benefits that is not taxable). Use Worksheet 1-1 and Worksheet 1-2 to determine your modified AGI.

Taxpayer’s tax return including income of a dependent child. A taxpayer who includes the gross income of a dependent child on the taxpayer’s tax return must include on Worksheet 1-2 the child’s tax-exempt interest and the portion of the child’s social security benefits that is not taxable.

Coverage family. Your coverage family includes only individuals in your tax family who are enrolled in a qualified health plan and are not eligible for MEC (other than coverage in the individual market). Also, an individual is in your coverage family for a particular month only if the portion of the enrollment premiums (described later) for the month for which you are responsible was paid by the due date of your tax return (not including extensions), the entire premium was covered by APTC, or the amount of the premium paid for the month was sufficient to avoid termination of the individual's coverage for that month described under Enrollment premiums , later. The individuals included in your coverage family may change from month to month. If an individual in your tax family is not enrolled in a qualified health plan, or is enrolled in a qualified health plan but is eligible for MEC (other than coverage in the individual market), that individual is not part of your coverage family. Your PTC is available to help you pay only for the coverage of the individuals included in your coverage family.

Monthly credit amount. The monthly credit amount is the amount of your tax credit for a month. Your PTC for the year is the sum of all of your monthly credit amounts. Your credit amount for each month is the lesser of:

To qualify for a monthly credit amount, at least one individual in your tax family must be enrolled in a qualified health plan on the first day of that month. Generally, if coverage in a qualified health plan began after the first day of the month, you are not allowed a monthly credit amount for the coverage for that month. However, if an individual in your tax family enrolled in a qualified health plan in 2025 and the enrollment was effective on the date of the individual’s birth, adoption, or placement for adoption or in foster care, or on the effective date of a court order placing the individual with your family, the individual is treated as enrolled as of the first day of that month. Therefore, the individual may be a member of your tax family and coverage family for the entire month for purposes of computing your monthly credit amount.

Enrollment premiums. The enrollment premiums are the total amount of the premiums for the month, reduced by any premium amounts for that month that were refunded in 2025, for one or more qualified health plans in which any individual in your tax family enrolled. Form 1095-A, Part III, column A, reports the enrollment premiums.

You are generally not allowed a monthly credit amount for the month if any part of that month’s enrollment premium for which you are responsible has not been paid by the due date of your tax return (not including extensions), unless the amount of the premium paid for the month is sufficient to avoid termination of the coverage for that month and the month is described under one of the following three scenarios:

The first month of a grace period described in 45 CFR 156.270(d) for the plan enrollees;
A month for which a premium payment threshold under 45 CFR 155.400(g) has been met and for which month the issuer of the qualified health plan provides coverage; or
A month for which a state department of insurance has, during a declared emergency, issued an order prohibiting the issuer of the qualified health plan from terminating the coverage for the month regardless of whether the full premium for the month is paid. However, if you became eligible for APTC because of a successful eligibility appeal and you retroactively enrolled in the plan, the full enrollment premium is considered to have been timely paid if the portion of the enrollment premium for which you are responsible is paid on or before the 120th day following the date of the appeals decision. Premiums another person pays on your behalf are treated as paid by you.

Applicable SLCSP premium. The applicable SLCSP premium is the second lowest cost silver plan premium offered through the Marketplace where you reside that applies to your coverage family (described earlier). The SLCSP premium is not the same as your enrollment premium, unless you enroll in the applicable SLCSP. Form 1095-A, Part III, column B, generally reports the applicable SLCSP premium. If no APTC was paid for your coverage,

For any months you were covered, did not pay your share of the premiums, and are allowed a monthly credit amount, the amount of the enrollment premiums for the month you use to compute your monthly credit amount must be reduced by any portion of the premium that is unpaid as of the unextended due date for filing your income tax return for the tax year that includes the month.

The enrollment premiums (described next) for the month for one or more qualified health plans in which you or any individual in your tax family enrolled, or
The amount of the monthly applicable second lowest

cost silver plan (SLCSP) premium (described later) less your monthly contribution amount (described later).

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Form 1095-A, Part III, column B, may be wrong or blank or may report your applicable SLCSP premium as -0-. Also, if you had a change in circumstances during 2025 that you did not report to the Marketplace, the SLCSP premium reported in Part III, column B, may be wrong. In either case, you must determine your correct applicable SLCSP premium. You do not have to request a corrected Form 1095-A from the Marketplace. See Missing or incorrect SLCSP premium on Form 1095-A, later.

Monthly contribution amount. Your monthly contribution amount is used to calculate your monthly credit amount. It is the amount of your household income you would be responsible for paying as your share of premiums each month if you enrolled in the applicable SLCSP. It is not based on the amount of premiums you paid out of pocket during the year. You will compute your monthly contribution amount in Part I of Form 8962.

Qualified health plan. For purposes of the PTC, a qualified health plan is a health insurance plan or policy purchased through a Marketplace at the bronze, silver, gold, or platinum level. Throughout these instructions, a qualified health plan is also referred to as a “policy.” Catastrophic health plans and stand-alone dental plans purchased through the Marketplace, and all plans purchased through the Small Business Health Options Program (SHOP), are not qualified health plans for purposes of the PTC. Therefore, they do not qualify a taxpayer to take the PTC.

Minimum essential coverage (MEC). An individual in your tax family who is eligible for MEC (except coverage in the individual market) for a month is not in your coverage family for that month. Therefore, you cannot take the PTC for that individual’s coverage for the months that individual is eligible for MEC. In addition to qualified health plans and other coverage in the individual market, MEC includes:

coverage if your share of the annual cost for coverage for yourself and the other members of your tax family allowed to enroll in the coverage is not more than 9.02% of your household income. If your employer coverage is affordable for you but not affordable for your other family members, you may be able to take the PTC for your other family members if they enroll in a Marketplace qualified health plan. However, employer-sponsored coverage is not considered affordable if, when you or a family member enrolled in a qualified health plan, you gave accurate information about the availability of employer coverage to the Marketplace, and the Marketplace determined that you were eligible for APTC for the individual’s coverage in the qualified health plan. In addition, if you or your family member enrolls in employer-sponsored coverage for a month, you or your family member is considered eligible for employer-sponsored coverage for that month, even if the coverage does not satisfy the affordability and minimum value standards. Finally, if your employer offered coverage for you but not your family, you may be able to take the PTC for your family members. For more information on affordability and minimum value, see Pub. 974. Your employer may have sent you a Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, with information about the coverage offered to you, if any. See Form 1095-C, line 14, and the Instructions for Recipient included with that form, for information about whether you and other members of your tax family were offered coverage. See Pub. 974 for more information on how to determine whether the coverage you were offered was affordable and provided minimum value, including on how to use Form 1095-C.

Example. Don was eligible to enroll in his employer’s coverage for 2025 but instead applied for coverage in a qualified health plan through the Marketplace for coverage in 2025. Don provided accurate information about his employer’s coverage to the Marketplace, and the Marketplace determined that the offer of coverage was not affordable and that Don was eligible for APTC. Don enrolled in the qualified health plan for 2025. Don got a new job with employer coverage that Don could have enrolled in as of September 1, 2025, but chose not to. Don did not return to the Marketplace to determine if he was eligible for APTC for the months September through December 2025 and remained enrolled in the qualified health plan. Don is not considered eligible for employer-sponsored coverage for the months January through August of 2025 because he gave accurate information to the Marketplace about the availability of employer coverage and the Marketplace determined that he was eligible for APTC for coverage in a qualified health plan. The Marketplace determination does not apply, however, for the months September through December of 2025 because Don did not provide information to the Marketplace about his new employer’s offer of coverage. Whether Don is considered eligible for employer-sponsored coverage and ineligible for the PTC for the months September through December of 2025 is determined under the eligibility rules described under Employer-Sponsored Plans in Pub. 974.

Waiting periods and post-employment coverage. If you cannot get benefits under an employer-sponsored

Most coverage through government-sponsored programs (including Medicaid coverage, Medicare Part A or C, the Children’s Health Insurance Program (CHIP), certain benefits for veterans and their families, TRICARE, and health coverage for Peace Corps volunteers);
Most types of employer-sponsored coverage; and
Other health coverage the Department of Health and Human Services designates as MEC.

Eligibility for MEC. In most cases, you are considered eligible for MEC if the coverage is available to you, whether or not you enroll in it. However, special rules apply to certain types of MEC, as explained below.

Employer-sponsored coverage. Even if you and other members of your tax family had the opportunity to enroll in a plan that is MEC offered by your employer for 2025, you are considered eligible for MEC under the plan for a month only if the offer of coverage met a minimum standard of affordability and provided a minimum level of benefits, referred to as “minimum value.” The coverage offered by your employer is generally considered affordable for you if your share of the annual cost for self-only coverage, which is sometimes referred to as the “employee required contribution,” is not more than 9.02% of your household income. The coverage offered by your employer is generally considered affordable for the other members of your tax family allowed to enroll in the

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plan until after a waiting period has expired, you are not treated as eligible for that coverage during the waiting period. Also, if you leave your employment and are offered post-employment coverage such as COBRA or retiree coverage, you are not considered eligible for that post-employment coverage unless you actually enroll in the coverage. See Coverage after employment ends under Employer-Sponsored Plans in Pub. 974 for more information.

Medicaid and CHIP. You are generally considered eligible for coverage under a government-sponsored program for a month if you met the eligibility criteria for that month, even if you did not enroll. However, if a Marketplace made a determination that you or a family member was ineligible for Medicaid or CHIP and was eligible for APTC when the individual enrolls in a qualified health plan, the individual is treated as not eligible for Medicaid or CHIP for purposes of the PTC for the duration of the period of coverage under the qualified health plan (generally, the rest of the plan year), even if your actual 2025 income suggests that the individual may have been eligible for Medicaid or CHIP.

However, in order to rely on a Marketplace’s determination that you or a family member was ineligible for Medicaid, CHIP, or a similar program, you must provide accurate information to the Marketplace when you enroll in a qualified health plan. You or the family member may be treated as eligible for Medicaid, CHIP, or the similar program, and not eligible for the PTC, if the Marketplace determination is later found to be based on incorrect information that was given with an intentional or reckless disregard for the facts. See Pub. 974 for more information.

For more information about eligibility for Medicaid, CHIP, and other forms of government-sponsored MEC, see Pub. 974.

one can claim you as a dependent for 2025. In addition, if you were married at the end of 2025, you must file a joint return to be an applicable taxpayer unless you meet one of the exceptions described under Married taxpayers, later.

For individuals with household income below 100% of the federal poverty line, see Household income below 100% of the federal poverty line under Line 5 , later. Individuals who are incarcerated. Individuals who are incarcerated (other than pending disposition of charges, for example, awaiting trial) are not eligible for coverage in a qualified health plan through a Marketplace. However, these individuals may be applicable taxpayers and take the PTC for the coverage of individuals in their tax families who are eligible for coverage in a qualified health plan.

Individuals who are not lawfully present. Individuals who are not lawfully present in the United States are not eligible for the PTC for their coverage in a qualified health plan through a Marketplace. They cannot take the PTC for their own coverage and are not eligible for the repayment limitations in Table 5 for APTC paid for their own coverage.

However, these individuals may be applicable taxpayers and take the PTC for the coverage of individuals in their tax families, such as their children, who are lawfully present and eligible for coverage in a qualified health plan.

Example. Married taxpayers Tom and Nicole applied for insurance affordability programs at the Marketplace for themselves and their two children whom they claim as dependents, Kim and Chris. The Marketplace determined that Kim and Chris were eligible for coverage under CHIP. Instead of enrolling Kim and Chris in CHIP, the entire tax family enrolled in a qualified health plan (with APTC paid only for Tom and Nicole’s coverage). Because Kim and Chris were eligible for CHIP, which is MEC, Tom and Nicole are not eligible for the PTC for coverage of Kim and Chris, but may be eligible for the PTC for their own coverage.

Coverage in the individual market outside the Marketplace. While coverage purchased in the individual market outside the Marketplace is MEC, eligibility for this type of coverage does not prevent you from being eligible for the PTC for Marketplace coverage. Coverage purchased in the individual market outside the Marketplace does not qualify for the PTC.

For more details on eligibility for MEC, including additional special eligibility rules, see Minimum Essential Coverage in Pub. 974.

Applicable taxpayer. You must be an applicable taxpayer to take the PTC. Generally, you are an applicable taxpayer if your household income for 2025 (described earlier) is at least 100% of the federal poverty line for your family size (provided in Tables 1-1, 1-2, and 1-3) and no

If all family members enrolled in a qualified health plan are not lawfully present, complete the following lines as explained below. Leave all other lines blank.

Lines 1, 2a, 3, 4, and 5. Enter -0-.
Line 9. See Line 9 , later, to determine whether you must complete Part IV for an allocation of policy amounts. Complete Part IV if instructed to do so by Table 3. Do not complete Part V.
Line 11, column (f) (or lines 12 through 23, column (f), if you complete Part IV). If you checked “No” on line 9, enter the total of your Form(s) 1095-A, Part III, line 33C, in line 11, column (f). If you checked “Yes” on line 9, complete lines 12 through 23, column (f), as instructed later under Column (f).
Line 24. Enter -0-.
Lines 25, 27, and 29. Enter the amount from line 11, column (f) (or the total of lines 12 through 23, column (f)), on each line. Then, follow the instructions for line 29, later.

For more information about who is treated as lawfully present for this purpose, go to HealthCare.gov . See Individuals Not Lawfully Present in the United States Enrolled in a Qualified Health Plan in Pub. 974 for more information on reconciling APTC when an unlawfully present person is enrolled individually or with lawfully present family members.

Married taxpayers. If you are considered married for federal income tax purposes, you must file a joint return with your spouse to take the PTC unless one of the two exceptions below applies to you.

You are not considered married for federal income tax purposes if you are divorced or legally separated according to your state law under a decree of divorce or separate maintenance. In that case, you cannot file a joint return but may be able to take the PTC on your separate

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return. See Pub. 501, Dependents, Standard Deduction, and Filing Information.

If you are considered married for federal income tax purposes, you may be eligible to take the PTC without filing a joint return if one of the two exceptions below applies to you. If Exception 1 applies, you can file a return using head of household or single filing status and take the PTC. If Exception 2 applies, you are treated as married but can take the PTC with the filing status of married filing separately.

Exception 1—certain married persons living apart. You may file your return as if you are unmarried and take the PTC if one of the following applies to you.

You file a separate return from your spouse on Form 1040 or 1040-SR because you meet the requirements for Married persons who live apart under Head of Household in the Instructions for Form 1040.
You file as single on your Form 1040-NR because you meet the requirements for the exception for married persons who live apart under Married Filing Separately in the Instructions for Form 1040-NR.

Exception 2—victim of domestic abuse or spousal abandonment. If you are a victim of domestic abuse or spousal abandonment, you can file a return as married filing separately and take the PTC for 2025 if all of the following apply to you.

You are living apart from your spouse at the time you file your 2025 tax return.
You are unable to file a joint return because you are a victim of domestic abuse (described next) or spousal

abandonment (described later).

• You check the box on your Form 8962 to certify that you are a victim of domestic abuse or spousal abandonment.

You do not meet the 3-year limit for Exception 2, described below.

Domestic abuse. Domestic abuse includes physical, psychological, sexual, or emotional abuse, including efforts to control, isolate, humiliate, and intimidate, or to undermine the victim’s ability to reason independently. All the facts and circumstances are considered in determining whether an individual is abused, including the effects of alcohol or drug abuse by the victim’s spouse. Depending on the facts and circumstances, abuse of an individual’s child or other family member living in the household may constitute abuse of the individual. If you have concerns about your safety, please consider contacting the confidential 24-hour National Domestic Violence Hotline at 1-800-799-SAFE (7233), or 1-800-787-3224 (TTY), or 1-855-812-1001 (video phone, only for deaf callers). For additional information and resources, see Pub. 3865, Tax Information for Survivors of Domestic Abuse, available at IRS.gov/Pub3865 ; and Part V of Form 8857, Request for Innocent Spouse Relief, available at IRS.gov/Form8857 .

Spousal abandonment. A taxpayer is a victim of spousal abandonment for a tax year if, taking into account all facts and circumstances, the taxpayer is unable to locate their spouse after reasonable diligence.

3-year limit for Exception 2. You cannot claim the PTC using this exception for more than 3 consecutive years. For example, if you used this exception to claim the PTC on your tax returns for 2022, 2023, and 2024, you

cannot use this exception to claim the PTC on your 2025 return.

Married filing separately. If you file as married filing separately and are not a victim of domestic abuse or spousal abandonment (see Exception 2 under Married taxpayers, earlier), then you are not an applicable taxpayer and you cannot take the PTC. You must generally repay all of the APTC paid for a qualified health plan that covered only individuals in your tax family. If the policy also covered at least one individual in your spouse’s tax family, you must generally repay half of the APTC paid for the policy. See Line 9, later. However, the amount of APTC you have to repay may be limited. See Line 28, later.