ACA Subsidy Calculator for Ages 62-64
Retire or lose employer coverage before 65, and you're on your own for health insurance until Medicare kicks in. Estimate how much help you'd get toward a Marketplace plan under 2026's rules, including the subsidy cliff that came back when the enhanced subsidies expired.
For 2026, the original ACA subsidy rules apply, because the temporary enhanced subsidies expired at the end of 2025: your premium tax credit depends on your household income as a percentage of the federal poverty line (FPL), using the IRS's applicable percentage table to set your expected contribution. Income above 400% of FPL generally means $0 in credit, no matter how expensive the plan. The "subsidy cliff" that was suspended from 2021-2025 is back in effect. This matters most for early retirees ages 62-64: Social Security income counts in full toward this calculation, even the untaxed portion, so claiming benefits early can meaningfully shrink your subsidy.
If you retire before 65, you usually have to buy your own health insurance until Medicare starts. This calculator applies the federal premium tax credit formula, so you know what to expect before you compare plans on healthcare.gov.
Estimate Your 2026 Subsidy
Estimated Monthly Premium Tax Credit
% of Poverty Line
Expected Contribution
After Subsidy, Per Month
Several states, including California, Massachusetts, New York, New Jersey, Washington, Connecticut, Vermont, Colorado, Maryland and New Mexico, pay their own subsidies on top of the federal credit, mostly at lower incomes. This tool calculates the federal amount only, so check your state's exchange as well.
From 2021 through 2025, temporary rules from the American Rescue Plan and the Inflation Reduction Act removed the income cap on subsidies and lowered the share of income households had to pay. Congress did not extend them past 2025. From 2026, the original rules apply again: no credit above 400% of the federal poverty line, and a higher required contribution below it. If your income is close to that cutoff, a modest increase, such as a larger RMD, a Roth conversion, or an earlier Social Security claim, can end the subsidy altogether. Go through that kind of decision with a planner or tax preparer before you commit to it.
The calculation has two steps. First, your household income is divided by the federal poverty line for your household size, which gives a percentage such as 150% or 250% of FPL. Second, the IRS applicable percentage table sets the share of income you are expected to pay toward the benchmark plan. The table is updated every year and is higher for 2026 than in the enhanced-subsidy years. The share runs from 2.10% near the bottom of the eligible range to 9.96% at the top. The premium tax credit is the benchmark plan's cost minus that expected contribution. You can use the credit on a plan in any tier. A cheaper Bronze plan may cost less than your credit, and a Gold plan will leave you paying more.
Many early retirees do not expect the Social Security rule. Federal income tax applies to at most 85% of Social Security benefits, and sometimes to none. ACA MAGI includes 100% of your benefits, whatever portion is taxable. Two people with the same take-home income can therefore have very different MAGI for subsidy purposes if one of them relies more on Social Security.
Frequently Asked Questions
How is the ACA premium tax credit calculated for 2026?
Your household income (MAGI) is compared to the federal poverty line (FPL) for your household size to find your income as a percentage of FPL. The IRS applicable percentage table sets what share of that income you're expected to pay toward the benchmark (second-lowest-cost Silver) plan. The premium tax credit is the benchmark plan's premium minus that expected contribution.
Is the ACA subsidy cliff back for 2026?
Yes. The temporary enhanced subsidies from the American Rescue Plan and Inflation Reduction Act expired at the end of 2025 and were not extended. For 2026, household income above 400% of the federal poverty line generally means $0 in premium tax credit, no matter how high the actual premium is. The original pre-2021 rules are back in effect.
Does Social Security income count toward ACA subsidy eligibility?
Yes. ACA MAGI counts the full amount of Social Security benefits you receive, including the portion that is not taxable under the regular income tax rules. If you have claimed Social Security before 65, all of it counts.
What if my income is below 100% of the poverty line?
Generally, marketplace premium tax credits require income at or above 100% of FPL. Below that level you are expected to qualify for Medicaid. In states that did not expand Medicaid, this can leave a "coverage gap", where income is too low for marketplace subsidies and too high for the state's traditional Medicaid rules. Check your Medicaid eligibility if this applies to you.
Do all states use the same subsidy rules?
The premium tax credit calculated here is federal and identical in every state. Several states, including California, Massachusetts, New York, New Jersey, Washington, Connecticut, Vermont, Colorado, Maryland, and New Mexico, layer their own additional state-funded subsidies on top for 2026. Check your state's exchange directly to see if you qualify for extra help beyond what this calculator shows.
Uses the IRS's 2026 Applicable Percentage Table (Rev. Proc. 2025-25) and the 2025 HHS federal poverty guidelines (the guidelines in effect for 2026 Marketplace enrollment). Assumes full-year coverage. If you'll turn 65 and move to Medicare partway through the year, your actual credit is prorated for the months you're enrolled in a Marketplace plan, which this tool doesn't calculate. It also doesn't include any state-funded supplemental subsidy your state may offer on top of the federal amount. This is a planning estimate, not a Marketplace determination. Get your exact figure at healthcare.gov or your state exchange when you apply.