The Advanced Premium Tax Credit is a federal tax credit to lower your monthly health insurance premium, when you buy health insurance coverage through the Marketplace.
Your APTC for a certain year is the amount of your premium tax credit that you elect to have the marketplace pay directly to your insurer every month in a given calendar year.
To qualify for the APTC, you have to buy health insurance through the marketplace and you are ineligible for government program or employer-sponsored health insurance
To qualify for the advanced premium tax credit, your modified adjusted gross income (AGI) must between the range of 100% and 400% of the federal poverty level.
APTC amount is based on the income estimate and household information you put on your Marketplace application. You can then choose how much of that to take in advance.
When you reconcile the numbers on your tax return, your advance premium tax credit exceeds your actual premium tax credit amount, you must repay that excess portion.
Those who make more will receive a smaller credit and a smaller monthly discount, while those with less income will receive larger credits and a larger discount on healthcare premiums.