Print Friendly and PDF

Dealing with Income Fluctuation on the Marketplace

What if you’re self-employed and experience income changes year over year? What if you have a job change which significantly impacts your income?

For those shopping for individual coverage on the Health Insurance Marketplace, it’s crucial to understand how subsidies function. A few pointers:

  • Income fluctuations should be reported via the Marketplace ASAP since income is used to determine subsidies.
  • The IRS will reconcile subsidies against income at tax time. Significant over- or under-estimations of income may mean that the IRS will either refund or bill for the difference.
  • For those who qualify, subsidies can either be claimed fully, partially, or deferred until tax time.
  • Accepting full or partial premium subsidies means that the amount of the subsidy will be paid monthly, in the form of partial payment for insurance premiums, directly to the individual’s insurance company.
  • Deferring premium subsidies until tax time means that the individual who chose to enroll in a plan will be fully responsible for paying the monthly premium directly to the insurer, but will receive a lump sum back from the IRS in the form of a tax refund.

This article from Bloomberg provides a helpful overview.

Questions or concerns about this, or any, topic related to health care?  Post them at, or email, for a quick, reliable response.

This post was contributed by Shannon Saksewski (Health Education Program Manager, Detroit Regional Chamber).  Shannon can be contacted at