Does the Health Insurance Marketplace include non-tax-dependent children under 21 in household size for premium subsidies?

1. Who the Marketplace says belongs in your “household” — and why it matters

HealthCare.gov and Marketplace guidance make household size central to subsidy eligibility: Marketplace savings are based on expected household income for everyone you’ll claim as a tax dependent, not just the people who will be covered by a plan ^{[1] [2]}. In short, if you will claim a child under 21 as a tax dependent, that child is part of your Marketplace household for premium tax credit calculations ^[3].

2. The key distinction: tax dependent status, not physical presence or age alone

Multiple official sources emphasize the test is tax dependency, not merely living in the same home or the child’s age: count those you will claim as federal tax dependents on your return ^{[2] [3]}. Third‑party explainers reiterate that non‑dependent household members who are not claimed on your taxes are generally not counted ^[6].

3. Income inclusion rules — when a dependent’s earnings move the needle

The Marketplace uses Modified Adjusted Gross Income (MAGI) for subsidy eligibility. Dependents’ incomes count toward household MAGI only if the dependent has a tax filing requirement — meaning if a dependent must file a federal return, their income is generally included; if they file just to get a refund but aren’t required, their income is not counted ^{[4] [5]}. CMS training materials and HealthCare.gov stress you should include income of tax dependents on the application and follow IRS filing‑requirement thresholds ^{[7] [4]}.

4. Practical consequences: subsidies can shrink or disappear if household size or dependent income changes

Because premium tax credits hinge on projected household MAGI and household size, adding or removing a dependent you’ll claim on your taxes — or changes in a dependent’s income that triggers a filing requirement — can materially change subsidy amounts. HealthCare.gov warns to report income and household changes promptly to avoid incorrect savings or owing money back at tax time ^{[2] [4]}.

5. Edge cases and enrollment realities: coverage vs. eligibility are separate questions

Sources note a separation between counting someone for subsidy calculation and whether they can be on the same insurance policy. A person included in your tax household for premium tax credit purposes (for example, an adult dependent) might still need a separate plan if insurers limit family policies to immediate family relationships; CMS‑oriented analysis gives examples where a dependent is ineligible for the premium tax credit but still counted in household size ^[8]. HealthCare.gov also highlights special rules for young adults under 26 staying on parents’ plans but that is a coverage rule distinct from subsidy calculation ^[9].

6. What the guidance does not settle explicitly in these sources

Available sources do not mention every possible custody or shared‑filing scenario (for example, shared custody where parents alternate claiming a child) in exhaustive detail here; HealthCare.gov does say only include children in years you will claim them as tax dependents, and independent explainers cover shared‑custody examples ^[6]. For precise outcomes in complicated tax‑filing or custody situations, CMS and IRS materials referenced by the Marketplace should be consulted ^{[7] [5]}.

7. Bottom line for parents of children under 21

If you will claim a child under 21 as a federal tax dependent, count that child in your Marketplace household size and include their income only if they are required to file a tax return — both factors affect your premium tax credit amount ^{[1] [4] [5]}. Report changes promptly to the Marketplace to keep subsidy amounts accurate ^{[2] [7]}.