Subsidies

When you apply for individual health insurance through HealthCare.gov (opens in new tab) or your state's Marketplace, you’re asked to estimate your income for the year. Once you've done this, you'll see if you qualify for two kinds of subsidies to make your health insurance less expensive.

If you expect your household income to be below a certain amount, you may qualify for an Advance Premium Tax Credit (APTC) (opens in new tab). This is a form of financial assistance provided by the state and/or federal government to help more people access affordable health insurance plans. Basically, it’s the government kicking in a little bit of money to lower the monthly cost of your health insurance plan.

The catch, of course, is that if you earned more money than you estimated on your insurance application, you may need to pay some of these tax credits back when you file your tax returns. But if your taxes show that your earnings qualify you for a bigger tax credit than you received, you may actually receive more of a tax refund.

The other catch is that if you're married but file your taxes separately, you won't qualify for Advance Premium Tax Credits. To qualify, you must be either legally single or married filing taxes jointly.