What this line means
Your total premium tax credit for the year. Add up the column (e) amounts from lines 11 through 23. If your coverage stayed the same all year, this is simply the amount from line 11, column (e). If circumstances changed during the year and you used the monthly lines, add up all the monthly amounts. This is the actual credit you earned based on your final income.
Does this apply to you?
- You completed Part II of Form 8962 and have amounts in column (e)
- You are determining whether you received too much or too little in advance payments
- You bought Marketplace coverage and your income qualifies for the Premium Tax Credit
Easy to overlook
Your actual credit may be larger than the advance payments you received If your income dropped during the year — from a job loss, reduced hours, or retirement — your actual PTC on this line may exceed the advance payments on line 25. The difference is extra money back on your return. Filers who had a bad year financially sometimes dread filing Form 8962, not realizing they are owed an additional credit. 1 IRS Form 8962 Instructions — Line 24
You can claim the full credit even if you received zero advance payments Some filers enroll in Marketplace coverage and pay the full premium each month without taking any advance credits. They can still claim the full PTC on their tax return by completing Form 8962. The credit appears on line 26 and flows to Schedule 3. Paying full price during the year does not forfeit the credit — it just shifts when you receive it. 2 IRS Publication 974 — Premium Tax Credit
Watch out for this
Skipping monthly calculations when you should have used them. If you used line 11 for the annual total but your coverage or circumstances changed mid-year, the credit on this line is wrong. Changes that require monthly calculations include switching plans, gaining or losing a dependent, moving to a different rating area, or a significant income change. Using annual figures when monthly figures are required usually produces an incorrect credit that the IRS will adjust.
Footnotes
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IRS Form 8962 Instructions, Line 24. https://www.irs.gov/instructions/i8962 ↩
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IRS Publication 974, Premium Tax Credit, Claiming the Credit. https://www.irs.gov/pub/irs-pdf/p974.pdf ↩