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The employer coverage offered by the various employ-
ers in the following examples qualifies as MEC.
Example 1. Celia is single and has no dependents.
Her household income for 2023 was $47,000. Celia’s em-
ployer offered its employees a health insurance plan that
provided minimum value and for which the required contri-
bution was $3,450 for self-only coverage for 2023 (7.34%
of Celia’s household income). Because Celia’s required
contribution for self-only coverage did not exceed 9.12%
of household income, her employer’s plan is considered
affordable for Celia, and Celia is considered eligible for
the employer coverage for all months in 2023. Celia can-
not get the PTC for coverage in a qualified health plan.
Example 2. The facts are the same as in Example 1,
except that Celia is married to Jon, they file a joint return
for 2023, and the employer’s plan required Celia to con-
tribute $5,300 for coverage for Celia and Jon for 2023
(11.28% of Celia’s household income). Because Celia’s
required contribution for coverage for herself and Jon ex-
ceeds 9.12% of household income, her employer’s plan is
considered not affordable for Jon and Jon is considered
not eligible for the employer coverage. Celia is, however,
considered eligible for the employer coverage for all
months in 2023 and cannot get the PTC for coverage in a
qualified health plan because her cost to enroll in the cov-
erage does not exceed 9.12% of their household income.
Jon is allowed a PTC if he does not enroll in the employer
coverage, enrolls in a qualified health plan through the
Marketplace for 1 or more months in 2023, and is other-
wise allowed a PTC.
Example 3. Don was eligible to enroll in employer cov-
erage in 2023. Don’s required contribution for self-only
coverage that provided minimum value was $3,550. Don
applied for coverage in a qualified health plan through the
Marketplace. The Marketplace projected that Don’s 2023
household income would be $37,000 and determined that
Don’s employer coverage was unaffordable because
Don’s required contribution was more than 9.12% of Don’s
household income. Don enrolled in a qualified health plan
through the Marketplace with APTC and not in the em-
ployer coverage. In December, Don received an unexpec-
ted $2,500 bonus, which increased his 2023 household
income to $39,500. Although Don’s required contribution
for the employer coverage was not more than 9.12% of the
household income on Don’s tax return, Don is considered
not eligible for the employer coverage for 2023 because
the Marketplace estimated that the employer coverage
would cost more than 9.12% of Don’s household income.
Don can get the PTC if he otherwise qualifies.
Example 4. Hal was eligible for employer coverage for
2023. His required contribution for self-only coverage was
$3,400, and Hal enrolled in the coverage. His household
income for 2023 was $33,000, which means that his re-
quired contribution was more than 9.12% of his household
income. Even though the employer coverage was not af-
fordable, Hal cannot get the PTC for coverage in a quali-
fied health plan because he enrolled in the employer cov-
erage.
Example 5. Elsa is married and has two dependent
children. Her household income for 2023 was $39,000. El-
sa’s employer offered only self-only coverage to employ-
ees. No family coverage was offered. The plan had a re-
quired contribution of $3,000 for self-only coverage for
2023 (7.69% of Elsa’s household income) and provided
minimum value. Because Elsa’s required contribution for
self-only coverage was not more than 9.12% of household
income, her employer’s plan is considered affordable for
Elsa. Thus, Elsa is considered eligible for the employer
coverage for 2023 and cannot get the PTC for coverage in
a qualified health plan. However, because Elsa’s employer
did not offer coverage to Elsa’s spouse and children, Elsa
could take the PTC for her spouse and two children if they
enrolled in a qualified health plan and otherwise qualify.
Determining affordability for part-year period. If
you are employed for part of a year or employed by differ-
ent employers during the year, you determine whether
your coverage is affordable by looking separately at each
coverage period that is less than a full calendar year. For
each period, the coverage is affordable if your required
contribution for the entire year would not be more than
9.12% of your household income for the year.
Example. Elvis was enrolled in a qualified health plan
without APTC beginning in January 2023. He began work-
ing for a new employer in May that offers health insurance
coverage with a calendar year plan year. Elvis’ required
contribution for the employer coverage for the remainder
of the year was $200/month, which would be $2,400 for
the full plan year. Elvis does not enroll in the employer
coverage or inform the Marketplace of the offer of em-
ployer coverage. Elvis’ household income for the year is
$20,000. Elvis’ employer coverage is considered unafford-
able for the period May through December because his
required contribution for the full plan year, $2,400, is more
than 9.12% of his household income. As a result, Elvis
could take the PTC for January through December if he
otherwise qualifies.
Coverage year not a calendar year. If your employ-
er’s plan year is not the calendar year and you are a calen-
dar year taxpayer, you determine whether your coverage
is affordable by looking separately at the portion of the cal-
endar year in each plan year. A coverage period in 2023
that falls in a plan year beginning in 2022 is considered af-
fordable if your required contribution for the entire plan
year is not more than 9.61% of your household income for
2023. A coverage period in 2023 that falls in a plan year
beginning in 2023 is considered affordable if your required
contribution for the entire plan year is not more than
9.12% of your household income for 2023.
The employer coverage offered by the various employ-
ers in the following examples qualifies as MEC.
Example 1. Tim’s employer offers health insurance
coverage with a plan year of July 1 through June 30. His
required contribution for the plan year that began on July
1, 2022, was $250 per month ($3,000 for the entire plan
year). Tim enrolled in a qualified health plan on January 1,
2023, and did not apply for APTC. Tim’s household
income for 2023 is $30,000. Tim’s required contribution for
Publication 974 (2023) 13