Updating Income and the Effect on Cost Sharing Reductions

benwrigh

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Say one receives a CSR when they signed up. At some point during the year they receive a raise and need to increase their income for the subsidy. Do they instantly lose their cost sharing reduction if their new income is above the income level for CSR?

Also, there are no implications for someone who wrongfully received a CSR since it is not a tax credit, correct?
 
The answers should be "yes" then "no", but when applied in the real world, only the wizard behind the curtain knows the real answer. Maybe a navigator would know?
 
Say one receives a CSR when they signed up. At some point during the year they receive a raise and need to increase their income for the subsidy. Do they instantly lose their cost sharing reduction if their new income is above the income level for CSR?

Also, there are no implications for someone who wrongfully received a CSR since it is not a tax credit, correct?

Remember everything is based on annual income so when figuring tax credits, it isn't about how much they are making today, rather how much total for the year. If they receive a significant raise in February, the impact is much more significant than if the raise hits in October.
 
Unless you are self-employed, apparently what you make this month will affect your status for the rest of next year.
 
Ben,

Just to answer your question, you are correct. CSR is not subject to clawbacks, only APTC's are. If CSR eligibility is lost mid year, any CSR payments claimed by the policyholder already is just free money. APTC will be reconciled based on true annual income.
 
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