How the true-up works
Your monthly credit is based on the income you expect. At tax time, you file Form 8962 to compare that advance credit with the credit your actual income allows.
If you got less than you were owed, the rest comes back as a refund or lowers your tax. If you got more, the extra is added to what you owe.
| Your actual income | Result on your tax return |
|---|---|
| Lower than estimated | You get the extra credit you were owed |
| About what you estimated | Little or nothing changes |
| Higher, but at or below 400% of the poverty line | You repay the excess, with no cap |
| Above 400% of the poverty line | You repay all of the advance credit |
The repayment cap is gone from 2026
Before 2026, many people with modest incomes had a cap on how much they had to pay back. The IRS says that beginning with tax year 2026, you must repay the full amount of any excess advance credit.
The 400% line makes this sharper. For 2026 coverage, that line is $62,600 for one person. Go one dollar over it and you lose the whole credit, so the full year's advance credit comes back on your return.
How to avoid a surprise bill
Report income changes to the Marketplace as soon as they happen. A raise, a new job or a large withdrawal from a retirement account can all change your credit. The Marketplace then adjusts your monthly credit.
You can also take less than the full advance credit each month. Our premium tax credit calculator lets you test different incomes. One conversation is usually enough to know whether this matters for you.