How do I apply for a subsidy if I don't know my income?

When you apply for tax credits, you will be asked to estimate your expected income for the upcoming year. Often a good place to start is last year’s tax return. What did you make last year? Do you expect it to stay about the same?

If your circumstances haven’t changed much, it’s a safe bet that your income will be about the same as the previous year. But if you’ve had a big change in your life, that may not necessarily be true. For example, if you recently lost your job, you’re probably expecting to make less than usual and your best-guess income estimate should reflect that.

When you buy health insurance on a certified marketplace, your income estimates will be compared against records at the IRS, the Social Security Administration, and other sources. If your estimate and the official records don’t match up, but you meet all other eligibility requirements, you’ll be asked to provide documentation to support your income projections.

If you don’t have that documentation handy, you’ll be awarded subsidies for up to 90 days while you gather and submit your documentation for verification. It is very important that you provide any documentation requested in a timely manner. If you don’t, your subsidies might be reduced or even terminated. You may also have to “pay back” any subsidies you received when you file your federal income taxes.

On the flip side, if you overestimate your income and end up claiming less of a tax credit than you are entitled to, the difference will be credited to you when you file your income taxes for this year.