LA Castle Brokers Group

Purpose: Explain, in clear language, how APTC (advance payments of the premium tax credit) and CSR (cost-sharing reductions) work under the ACA, what the Marketplace verifies, and which practical steps to follow. This is general information; always confirm your case with a licensed agent. It is not tax or legal advice.

Key points

• You can use APTC with any metal level (Bronze, Silver, Gold, Platinum).
• Eligibility considers your household MAGI, household size, and access to other minimum essential coverage.
• An affordable employer offer with minimum value generally disqualifies you from APTC.
• For eligibility calculations, the Marketplace typically uses the prior year’s Federal Poverty Guidelines for the upcoming coverage year.

What is CSR?

CSR lowers deductibles, copays, coinsurance, and generally the annual out-of-pocket maximum when you use care. If you qualify by income, those reductions apply only if you choose a Silver plan on the Marketplace.

AI/AN exception
Members of federally recognized American Indian/Alaska Native tribes may qualify for zero or reduced cost-sharing under specific rules.

Key differences

• APTC: reduces your monthly premium; available on all metal levels.
• CSR: reduces costs when you use the plan; available on Silver for income-based eligibility (with specific AI/AN rules).

Taxes and APTC reconciliation

If you receive APTC during the year, you must reconcile the advance with your final credit based on actual income when you file:

• You will receive Form 1095-A from the Marketplace.
• Use that information to complete IRS Form 8962.
• If your actual income is lower than projected or you used less APTC than allowed, you may get a credit/refund. If it is higher, you may need to repay some APTC (subject to IRS limits).
• Failure to file and reconcile can affect future eligibility for APTC.

Changes you should report to the Marketplace

Update your application when there are changes in:

• Household income.
• Household size (marriage, birth, dependents).
• Address or county.
• Access to employer coverage or government programs.

Practical recommendations

• If your income fluctuates (self-employed, commissions), review it frequently and adjust your application.
• Consider applying only part of your APTC during the year to reduce the risk of repayment at tax time.
• If you qualify for CSR, evaluate a Silver plan: that is where the reductions in deductibles and copays apply.
• Keep documentation and review your 1095-A as soon as it arrives to correct errors before filing.
• If your employer offers an affordable plan with minimum value, you generally cannot receive APTC; the family rule for dependents applies.

Frequently asked questions

Can I use APTC on Gold or Platinum?
Yes. APTC can be applied to any metal level. The amount is based on the second-lowest cost Silver plan (SLCSP) in your area.

Does CSR lower my premium?
No. CSR reduces costs when you use care (deductibles/copays). Premiums are lowered through APTC.

What if my final income ends up below 100% FPL?
If you enrolled in good faith expecting ≥100% FPL, you may be able to claim the credit when filing for that year. For the following year, if you still project <100% FPL, you typically won’t qualify for APTC, subject to Marketplace and state rules.

Compliance notice
This content is educational and does not guarantee eligibility or amounts. Financial assistance and plan selection must be evaluated with a licensed advisor under Marketplace and CMS rules. We do not provide tax or legal advice. For taxes, consult the IRS or your tax professional.