On December 23, 2025, the IRS released the FAQs for the Premium Tax Credit under the One Big Beautiful Bill. It is a refundable tax credit, which can be claimed via tax return in 2026.
The PTC helps eligible individuals and families pay for health insurance. For tax year 2025, many changes have been made, and you must be aware of that as the 2026 tax season is arriving.
If you have purchased health insurance from the Health Insurance Marketplace and fall between low- to moderate-income earners, you can get a refund. The due date to file 2026 taxes is April 15, 2026.
IRS 2026 PTC Rules
For the tax year 2025, the Premium Tax Credit goes through multiple changes because of the One Big Beautiful Bill. The changes are discussed below.
- Repayment caps are eliminated, which means if an individual Advance Premium Tax Credit exceeds the allowed credit, he or she will have to repay the exceeding amount.
- To claim the Premium Tax Credit, one must have household income between 100 and 400 percent of the Federal Poverty Line, not be claimed as a dependent on anyone’s tax return, and have enrolled in marketplace coverage and not be eligible for affordable employer or government coverage.
- The household income for the PTC is one’s MAGI and the MAGI of required-to-file family members, which includes adjusted gross income, tax-exempt interest, and nontaxable Social Security benefits. It doesn’t include Supplemental Security Income.
- If income or family size changes during the year, one may owe money at tax time or receive a very small refund.
- If anyone’s employer offers health insurance, he or she can claim the Premium Tax Credit.
- One must file a federal return and attach Form 8962. If one does so by the deadline of April 15, 2025, he or she won’t be able to get the Advance Premium Tax Credit.
- If an individual isn’t capable of paying the exceeding APTC, he or she can opt for installment payment plans or go with the other payment relief options.
How much is the 2026 Premium Tax Credit?
The premium tax credit for the tax year 2025 isn’t a fixed amount; it depends on one’s household income, household size, and cost of health plans in his or her area. By claiming it, one can reduce tax liability and get a refund if the liability is zero or less than the amount one is eligible for.
To calculate PTC, first one needs to find his or her household income, then compare it to the Federal Poverty Level, and then find the SLCSP. After that he or she has to calculate his or her contribution using the formula: Expected Contribution = Household Income × Required %.
To calculate the PTC for tax year 2025, you have to deduct the expected contribution from the second lowest cost silver plan. If you get the figure in negative or it’s zero, it means that he or she isn’t eligible for this tax credit; if it is positive, you will get the same amount.
Let’s understand it by example. Suppose that your household income is $30,000, the required contribution is 6%, and the SLCSP cost is $6,000. So, your premium tax credit for the tax year 2025 is $4,200.
When to expect the 2026 PTC refund?
The refund for the PTC in 2026 will be received after the tax filings; it depends on one’s filing method and time when he or she will get it. If an individual files it electronically, they can expect to get it within three weeks; in the case of on-paper filing, the waiting time is six weeks.
Note that the 2026 tax return, which will be filed during the peak timing, i.e., between late March 2026 and 15 April 2026, will have to wait more than the usual time. The filing is going to start from early January 2026; e-file initially to expect your refund by early February 2026.
Disclaimer: IRS Premium Tax Credit rule updates are for general awareness only. Official eligibility and credit amounts are determined by the IRS.
