For the past several years, a temporary provision meant that no one buying ACA marketplace coverage was ever charged more than about 8.5% of their income toward a benchmark plan, no matter how high that income was. That provision — the enhanced premium tax credit, introduced by the American Rescue Plan and extended through the Inflation Reduction Act — expired at the end of 2025. Multiple Senate attempts to extend it through 2026 have failed to reach the 60 votes needed, and as of late September 2026, no extension has passed. That means 2027 ACA marketplace coverage reverts to the original, pre-2021 subsidy rules — including a hard income cutoff that didn't exist for the last several years.
The subsidy cliff, explained
Under the restored original rules, premium tax credits are only available to households with income between 100% and 400% of the federal poverty level. Above 400% FPL, there is no subsidy at all, regardless of how expensive your benchmark plan is relative to your income — a sharp drop-off commonly called the "subsidy cliff." A household that was receiving hundreds of dollars a month in credits at 405% of the poverty level under the enhanced rules will receive $0 in 2027 if their income stays in that range.
2027 income brackets and the percentage of income you're expected to pay
The IRS sets an "applicable percentage" table each year specifying what portion of income households at each income band are expected to contribute toward their benchmark plan before subsidies fill the rest. For 2027 (Revenue Procedure 2026-26, released July 21, 2026): under 133% of the federal poverty level, 2.15%; 133-150% FPL, 4.3%; 150-200% FPL, 6.78%; 200-250% FPL, 8.66%; and 250-400% FPL, 10.22% — a flat rate across that whole upper range. Above 400%, the calculation doesn't apply at all.
2026 federal poverty level figures used for 2027 eligibility
Eligibility for 2027 coverage is judged against the FPL guidelines published in January 2026: $15,960 for a single person, adding $5,680 for each additional household member. A family of four's 400% cutoff, for example, works out to $132,000 — above that, no subsidy under current law.
The 2027 out-of-pocket maximum is also rising
Separate from premium subsidies, HHS confirmed the 2027 out-of-pocket maximum for an individual ACA plan at $12,000, up from $10,600 in 2026. That's the most you'd pay out of pocket for covered care in a plan year, on top of whatever premium you're paying — worth factoring in alongside the premium math when comparing plans.
Estimating your own 2027 premium tax credit
The actual dollar amount of your credit depends on your area's benchmark plan (the second-lowest-cost Silver plan for your household), which varies enormously by ZIP code, county, insurer, and the ages of everyone covered — there's no reliable single national or state average worth quoting. Look up your specific benchmark premium at healthcare.gov, then plug it in along with your household size and income to see an estimate. One honest limitation: the real IRS formula smoothly interpolates the applicable percentage within each income band, while a simplified calculator using published band boundaries will show a close but not perfectly exact number — treat any online estimate, including this one, as a starting point, not your final number.
Try the 2027 ACA Premium Subsidy Calculator →
Sources: Bipartisan Policy Center, "Enhanced Premium Tax Credits: Who Benefits, How Much, and What Happens Next?" (2026); Health Affairs Forefront, "Extending Enhanced Premium Tax Credits: Where Things Stand" (2026); IRS Revenue Procedure 2026-26 (2026-07-21), 2027 applicable percentage table, via currentfederaltaxdevelopments.com; HHS 2026 Federal Poverty Guidelines (published 2026-01-15, federalregister.gov); HHS 2027 out-of-pocket maximum confirmation, via themoneyoverview.com and healthinsurance.org.