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Arturo and deena are married with two dependents. They enrolled in a qualified plan through the...

Arturo and deena are married with two dependents. They enrolled in a qualified plan through the marketplace at a cost of $2,700 per year. Their household income was $31,000. Their premium is $3,600. What is their premium tax credit.

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Answer #1

TABLE 1: Expected Premium Contributions at Different Income Levels (2019) Income Expected Premium Contribution Remaining After PTC Percentage of poverty line Annual dollar amount 111 Monthly contribution Premiunm contribution as % of income (in 2019) [21 Family of four < 133% 133-138% 138-150% 150-200% 200-250% 250-300% 300-400% > 400% < $33,383 $33,383 - $34,638 $34,638 $37,650 $37,650 $50,200 $50,200 $62,750 $62,750 $75,300 $75,300 - $100,400 $100,400 2.08% 3.11-3.42% 3.42-4.15% 4.15-6.54% 6.54-8.36% 8.36-9.86% 9.86% n/a $58 $87- $99 $99 $130 $130 - $274 $274- $437 $437 - $619 $619 - $825 n/a

Since Arturo and Deena's family falls into the lowest income bracket, they are expected to pay 2.08% of their household income as insurance premium. This roughly translates to 2.08% of $31,000=$644.8

Marketplace cost of a plan that covers the entire family = $2,700

Premium of the above plan = $3,600

Premium Tax Credit = $(3,600-644.8) = $2,955.2

Thus, the family is entitled to a premium tax credit of $2,955.2.

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