TAX PROVISION

Assistance for Health Care

Using Tax Policy to Stimulate the Economy | March 2021

In addition to direct payments and the credits mentioned above, two of the provisions focus on health care. First, the ARPA extends the advance health insurance premium tax credit through 2022. In addition, any excess payment of the 2020 advance premium credit will not have to be repaid. Taxpayers who have received or are approved to receive unemployment in 2021 will be treated as having income no greater than 133% of the federal poverty level, thus providing for the maximum credit.

Further, the ARPA eliminated the cap on credits for taxpayers whose earnings are more than 400% of the federal poverty level. Credits are therefore available to higher income earners purchasing insurance on the public exchanges.

The ARPA also provides for 100% COBRA premium assistance from April 1 to September 30, 2021. The provision does not extend the period of eligibility for COBRA coverage however.