The 400% Subsidy Cliff Is Back for 2026 and 2027

For 2026 and 2027 coverage there is no premium tax credit above 400% of the federal poverty level¹. One dollar of household income over that line removes the whole credit, not a part of it.

The COBRA vs Marketplace calculator computes where the line sits for a given household size, state and coverage year. This page sets out the rule behind that number.

Where the line is

The limit is a percentage of the federal poverty line, not a fixed dollar amount. It moves with household size, with region, and with which year’s poverty guidelines the coverage year uses.

The selection rule is Use the guidelines in effect when open enrollment for that coverage year opened². So 2026 coverage is measured against the 2025 guidelines, and 2027 coverage against the 2026 guidelines.

Coverage year	Guidelines used	400% for one person	400% for a household of four
2026	2025 — $15,650 base, +$5,500 per additional person3	$62,600	$128,600
2027	2026 — $15,960 base, +$5,680 per additional person4	$63,840	$132,000

Both columns are the 48 contiguous states and the District of Columbia. Alaska and Hawaii use higher guidelines, which the federal poverty level tables set out in full.

The status of the enhanced credits

Expired — not extended (no law enacted as of September 6, 2026)⁵. The larger credits created by the American Rescue Plan Act of 2021 and continued by the Inflation Reduction Act of 2022 applied through plan year 2025 and lapsed on December 31, 2025. Those rules removed the 400% limit for their duration.

H.R. 1834 passed the House on January 8, 2026 by 230 to 196 on roll call 11. The Senate did not reach the 60 votes needed to proceed on S. 3385. Neither has become law. We update this page when that changes.

Why the 2027 table is evidence

The IRS publishes an applicable percentage table each summer for the following year. Rev. Proc. 2026-26, issued on July 21, 2026, sets the 2027 table at 2.15% – 10.22% of household income⁶.

That table still has a “Less than 133%” floor row. It still ends with a row reading “At least 300% but not more than 400%”. A table written for restored enhanced credits would not stop at 400%, because the enhanced schedule had no upper limit. The published shape is the clearest official signal that the original schedule governs 2027.

What crossing the line costs

Below the limit the credit is the difference between the benchmark plan’s premium and a capped share of household income. Above the limit the credit is zero. Nothing tapers.

Example. A hypothetical single applicant in Ohio prices 2026 coverage. The 400% line for a household of one is $62,600. At $62,500 of household income a credit is possible; at $62,700 it is not. The full benchmark premium is payable at the higher figure.

Income for this test is household income as the Marketplace defines it, which is modified adjusted gross income for the tax family. Wages are only one input. A capital gain, a Roth conversion or a withdrawal from a traditional account all count. So do the earnings that feed the Social Security earnings test for anyone claiming benefits before full retirement age.

Did Congress extend the ACA subsidies?

No. As of September 6, 2026 no law extending the enhanced premium tax credits has been enacted. H.R. 1834 passed the House on January 8, 2026 by 230 to 196; S. 3385 did not reach the 60 votes needed to proceed in the Senate.

What is the 400% subsidy cliff?

It is the point at which premium tax credit eligibility ends outright. Household income at or below 400% of the federal poverty line can qualify for a credit; income above it cannot, however small the excess.

How much income is 400% of the federal poverty level?

For 2026 coverage in the contiguous states it is $62,600 for a household of one and $128,600 for a household of four. For 2027 coverage the same figures are $63,840 and $132,000, because the coverage year moves to the 2026 guidelines.

Will the subsidies come back for 2027?

No law says so as of September 6, 2026. The 2027 applicable percentage table published on July 21, 2026 still stops at 400% of the poverty line, which is how the IRS has written the rule for that year.

Does the cliff apply if my employer offers coverage?

An offer of affordable employer coverage that meets minimum value blocks the credit at any income. Affordability is measured against a separate required contribution percentage, which the applicable percentage table sets out for both years.

Does the cliff apply to Medicaid or cost-sharing reductions?

No. Those are separate tests at lower income levels and are unaffected by the 400% limit. The 400% line governs the premium tax credit only.

How close to the line does the calculator show?

Within two percentage points of the limit the tool reports household income as a percentage of the poverty line to three decimal places, because rounding to one decimal can put a household on the wrong side of the answer.