Count income & household size

When you fill out a Marketplace application, you’ll need to estimate what your household income for the year.

Marketplace savings are based on your expected household income for the year you want coverage, not last year’s income.
You'll be asked about your current monthly income and then about your yearly income.

Make your best estimate for your income

This way, you qualify for the right amount of savings. Otherwise, you could have to pay money back when you file your federal tax return. If your income changes during the year, you can update your application.

The Marketplace uses a number called "modified adjusted gross income (MAGI)" to determine if you qualify for savings.

What's a modified adjusted gross income (MAGI)?

Whose income to include in your estimate

For most people, a household consists of:

The tax filer
Their spouse if they have one
Their tax dependents, including those who don’t need coverage

The Marketplace counts estimated income of all household members. Learn more about who’s counted in a Marketplace household.

What income types to count in your estimate

Count these income types:

Alimony from divorces and separations finalized before January 1, 2019
Capital gains
Excluded (untaxed) foreign income

Federal taxable wages (from your job)

If your pay stub lists “federal taxable wages,” use that. If not, use “gross income” and subtract the amount(s) your employer takes out of your pay for child care, health coverage, and retirement plans.

Investment income Include expected interest and dividends earned on investments, including tax-exempt interest. Rental and royalty income Use net rental and royalty income. Retirement or pension income

Include most IRA and 401k withdrawals. Don’t include qualified distributions from a designated Roth account.

Self-employment income

Include the income you expect to make from your business after expenses. You'll also need to describe the type of work you do. If you earn money from farming or fishing, just list it as either 'farming or fishing' income or 'self-employment' income, but not both.

Social Security

Include both taxable and non-taxable Social Security income. Enter the full amount before any deductions.

Unemployment compensation Include all unemployment compensation that you get from your state. Don't count these income types:

Alimony for divorces and separations finalized on or after January 1, 2019
Child support
Child Tax Credit checks or deposits (from the IRS)
Gifts
Proceeds from loans (like student loans, home equity loans, or bank loans)
Supplemental Security Income (SSI)
Veterans' disability payments
Worker's compensation

If you expect other income types or have questions, get details on what counts as income from the IRS.

Do I include my dependents' income from things like summer jobs, work-study, and limited part-time work?

Count their income only if they need to file a federal tax return. Check IRS guidelines on filing requirements for dependents.

If they file a tax return when they don't have to – like to get a tax refund – their income won't be counted.

Can I take any income deductions?

The Marketplace lets you subtract certain deductions from your income. Find out about these deductions and how to report them.

What if my income is hard to predict (like if I work irregular hours or seasonally)?

Sometimes it can be hard to predict your income, like if you work seasonally, have an irregular work schedule, or recently changed jobs. For now, report your current income. We’ll show you a yearly estimate. You can update your application by reporting changes as they happen.

Report income changes to the Marketplace

Once you have Marketplace health insurance, it’s important to report any income changes as soon as possible.

Failing to do so could mean missing out on savings or owing money back when you file your federal tax return. Learn how to report changes to the Marketplace.