What are the 2026 MAGI limits for premium tax credits under the Affordable Care Act?
Executive summary
The 2026 eligibility limits for premium tax credits under the Affordable Care Act return to a MAGI-based cutoff tied to the Federal Poverty Level: generally households with MAGI between 100% and 400% of FPL qualify for the premium tax credit, unless Congress extends the temporary enhancements that suspended the 400% cliff through 2025 [1] [2] [3]. MAGI for these purposes is calculated from AGI with specific add‑backs (untaxed foreign income, non‑taxable Social Security, tax‑exempt interest), and important procedural changes for 2026—like elimination of repayment caps—also affect recipients [4] [5] [6].
1. What “MAGI limits” mean in 2026 and why the 400% cliff is back
For coverage year 2026, premium tax credit eligibility re‑aligns with the traditional ACA framework: subsidy eligibility will generally apply to households whose modified adjusted gross income is at least 100% and not more than 400% of the Federal Poverty Level for the household size, because the enhanced, slope‑based subsidy rule that removed the 400% cap for 2021–2025 was not extended and is set to expire after 2025 [1] [2] [7].
2. Dollar thresholds and practical MAGI examples
Practical guidance published by financial advisers and calculators translates the percentages into dollar cutoffs: for 2026, keeping MAGI under 400% of FPL is equivalent to roughly $62,600 for a single person, $84,600 for a couple, and $128,600 for a family of four (continental U.S. figures commonly cited), so households above these levels would generally lose eligibility for premium tax credits if no legislative change occurs [8] [9].
3. How MAGI is computed and what income counts toward the limit
The Marketplace uses modified adjusted gross income (MAGI) to determine eligibility, which starts with federal adjusted gross income and adds certain items back in—untaxed foreign income, non‑taxable Social Security benefits, and tax‑exempt interest—so the number used for subsidy eligibility can differ from taxable income reported on a return [4] [6].
4. Repayment, reconciliation and other 2026 procedural changes that matter
Two consequential changes intersect with the return of the 400% cap: households receiving advance payments of the premium tax credit must reconcile actual MAGI on their tax return, and starting with 2026 the repayment‑cap safeguards that limited how much excess subsidy a household could be forced to repay have been removed by recent law; that combination raises the downside risk for households whose income ends up higher than expected [6] [5].
5. The uncertainty variable: Congress, rates and advocacy stakes
Analysts and think tanks warn that if enhanced credits are not extended, average Marketplace premiums and out‑of‑pocket costs will climb substantially in 2026 and many who benefitted from slope‑based subsidies will face sudden loss of assistance; conversely, extension of the enhanced credits would continue the more generous formula through legislative action—an outcome explicitly flagged as possible by policy briefs and congressional analyses [7] [10]. Market actors and consumer advocates have clear incentives to emphasize either the cliff’s pain (insurers and fiscal hawks stressing cost) or the humanitarian impact (advocates stressing affordability), and calculators and advisory sites frame the question in practical terms for consumers [2] [11].
6. What individuals and families can do under current rules
Under the 2026 rules as currently described in public guidance, households that are near the 400% line can employ tax‑planning levers—HSA, retirement plan contributions, or timing of distributions—to reduce MAGI and preserve eligibility, while those well above the threshold need to plan for paying full premiums; guidance and calculators from consumer‑facing organizations outline these strategies and the income thresholds that trigger different payment responsibilities [8] [12] [11].