Premium Tax Credits

Premium tax credits are a form of financial help for eligible individuals and families to lower the cost of their health insurance premiums.

In Minnesota, MNsure is the only place you can get premium tax credits.

Think of it like a discount from the federal government, but with important limits:

  • You must meet the rules about income, taxes, and no access to other affordable insurance.
  • You may have to pay money back at tax time. If your income is higher than what you estimated, you may owe the government money when you file your taxes.

Imagine your health insurance costs $500 per month. If you qualify for premium tax credits, the federal government might pay $200 of that. You only pay $300 each month, instead of $500.

How is it Changing in 2027?

Starting in 2026, the federal government is giving less financial help to pay for health insurance. Consumers may need to pay more for health in 2027 as well.

  • In 2027, a Minnesotan who makes more than $63,840 per year ($86,560 for a married couple) won't qualify for any tax credits. 
  • You may need to pay more each month compared to last year.

Reminder: Compare options to find the best plan

Without the extra help, many people will have to pay more money each month for their health insurance. To find the best value, shop and compare all of your options at MNsure.org.

  • The prices you see today have these changes baked in.
  • Talk to an expert who can help. A MNsure-certified broker can explain federal changes to financial help and help you choose the best plan.

Who is Eligible?

You may be able to get this help if:

  • Your income is not too high: You need to make a certain amount of money each year. If you make too much, you might not qualify.
  • You don't have access to other affordable insurance: You can’t get premium tax credits if your job offers you affordable insurance, or if you’re covered by a government program.
  • You're not eligible for Medical Assistance (Medicaid) or MinnesotaCare.
  • You are a U.S. citizen, a U.S. national, a lawful permanent resident (green card holder), a Cuban or Haitian Entrant, or in the U.S. under the Compact of Free Association (COFA) with the Federated States of Micronesia (FSM), the Republic of the Marshall Islands (RMI), or the Republic of Palau (Palau). 
  • You file taxes: You need to file a tax return. If you're married, you usually must file together.

How Does it Work?

Advanced premium tax credits (APTC) work like an instant discount to lower your monthly premiums. If you're eligible, MNsure sends your tax credits to the insurance company—and you pay a lower bill.

  • You can choose to use some, all, or none of your tax credits during the year.
  • You can also change the amount you use during the year. Read about how to change your APTC amount.

Or, you can choose to apply premium tax credits later, when you file your taxes.

How are Tax Credits Calculated?

The amount of your premium tax credit is based on:

  • Your household’s total expected income for the year.
  • Number of people in your household.
  • The monthly cost of the benchmark plan where you live. You can choose a different plan, but tax credits are based on this amount.
  • How much the federal government says you should pay for the benchmark plan, as a percent of your income. For example:
    • In 2027, the federal government says if you earn 200% FPL, you should pay up to 6.8% of your income on monthly premiums. That’s $392 per month for one person.

The Fine Print

You need to file IRS Form 8962 with your federal income tax return. Learn more about claiming or reporting premium tax credits.