What are the 2021 Federal Poverty Levels?

Every year, the perimeters of the Federal Poverty Level (FPL) increase based on the cost of living. Families need to understand where they fall on the FPL so they know whether they are eligible for Medicaid in their state or whether they are eligible for a federal Subsidy because they earn between 100 and 400 percent of the FPL, or whether they are eligible for a tax credit because they purchased a Silver plan and earn less than 250% of the FPL.

For households with more than 8, add $4,540 for each additional person. Note: Eligibility for premium tax credits in coverage year 2021 is based on poverty guidelines for 2020.

FPL = federal poverty line.

Related: What Are Federal Poverty Levels Used For?

For purposes of the FPL affordability safe harbor, the FPL is determined by the state in which the employee is employed. The 2021 FPLs for the continental U.S. (48 contiguous states and the District of Columbia), Alaska and Hawaii are as follows:

• Continental U.S.: $12,880 (up from $12,760 in 2020)
• Alaska: $16,090 (up from $15,950 in 2020)
• Hawaii: $14,820 (up from $14,680 in 2020)

For 2021, the FPL safe harbor is determined by multiplying 9.83% by the applicable FPL threshold and dividing that product by 12. The result is the monthly limit on the employee-only required contribution for the ALE’s lowest-cost health coverage option that meets minimum value.

•To be eligible for a full (100%) premium subsidy, the individual must have countable income less than, or equal to 135% of the FPL for the applicable State and family size.

If the individual’s income is less than or equal to 135% of the FPL, he or she is eligible for a full premium subsidy, regardless of whether the individual’s countable resources are under the lower limit ($7,970 or less) or the higher limit ($13,290 or less). Although eligible for a full premium subsidy, the individual gets less help with deductibles and co-pays, if his or her countable resources are over the $7,970 limit but under the $13,290 limit.

Minimum Income

In addition to the maximum income to receive the premium subsidy, there’s also a minimum income to get accepted by the ACA marketplace. If your estimated income is too low, the ACA marketplace won’t accept you. They send you to Medicaid instead. In states that expanded Medicaid, the minimum income is 138% FPL. In states that didn’t expand Medicaid, the minimum income is 100% FPL. Here’s a map that shows which states expanded Medicaid and which states did not: Current Status of State Medicaid Expansion Decisions, Kaiser Family Foundation.

However, unlike the maximum income, the minimum income is only looked at the time of enrollment, not at the time when you file your tax return. If your estimated income at the time of enrollment is below the minimum, the ACA marketplace won’t accept you and they will refer you to Medicaid. If your estimated income at the time of enrollment is above the minimum and they accepted you, but due to unforeseen circumstances your income for the year ended up below the minimum, as long as you made the original estimate in good faith, you are not required to pay back the premium subsidy you already received.