Covered California Proof of Income When Unemployed

To show proof of income to Covered California when you’re unemployed, you document every source of money still coming in (unemployment benefits, severance, retirement withdrawals, a spouse’s wages, self-employment) and submit a good-faith projection of what your household expects to earn for the full coverage year. If you have no pay stubs or benefit letters at all, Covered California accepts a signed self-attestation of income on a case-by-case basis.¹

What Still Counts as Income Without a Paycheck

Covered California uses Modified Adjusted Gross Income, or MAGI, which starts with your adjusted gross income and adds back items like tax-exempt interest and non-taxable Social Security.² Savings, home equity, and other assets are not part of the calculation. Only money flowing to you is.

For most people who recently lost a job, unemployment insurance is the biggest piece. The IRS treats those payments as taxable, so they count toward MAGI.³ Other sources Covered California includes:⁴

Social Security retirement and SSDI payments
Pension and retirement account distributions, including 401(k) and IRA withdrawals
Interest, dividends, and capital gains
Net profit from freelance, gig, or side-business work
Severance paid as a lump sum or in installments
Your spouse’s income and the income of anyone you claim as a tax dependent

A few things don’t count and often confuse applicants: child support, gifts, veterans’ disability, Supplemental Security Income (SSI), workers’ compensation, and loan proceeds.⁴ SSI sounds like Social Security but is a separate needs-based program that Covered California ignores entirely.

Documents Covered California Accepts

If Covered California asks you to verify what you reported, the paperwork you submit depends on where the money is coming from.

Unemployment: your EDD Award Letter showing the weekly benefit and remaining weeks, or Form 1099-G reporting benefits paid during the tax year.
Severance: a letter from your former employer, or pay stubs showing amounts and dates.
Social Security or SSDI: a benefit verification letter from the Social Security Administration.
Retirement distributions: Form 1099-R from the plan administrator, or a recent account statement.
Self-employment: your most recent tax return with Schedule C or Schedule SE, a profit-and-loss statement, or bank records showing business deposits.

When You Have No Documents to Submit

If you’ve been out of work long enough that none of the standard paperwork applies, Covered California allows a self-attestation of income signed under penalty of perjury, considered on a case-by-case basis.¹ This is a written statement in which you declare your income and take legal responsibility for its accuracy. Covered California posts a downloadable attestation form on its website for applicants with nothing else to show.

Starting From Last Year’s Tax Return

When you’re not sure where to begin, Covered California suggests pulling the adjusted gross income from line 11 of your most recent Form 1040 and adjusting it for what has changed.⁵ Subtract the wages you no longer earn, then add unemployment, severance, and anything else you expect to receive this year. That adjusted figure becomes the number you report.

Projecting a Full Year of Income

Financial help is tied to what your household expects to earn for the entire coverage year, not what you happen to be earning this month.⁵ That is what makes verification awkward for anyone between jobs: you’re forecasting a year that hasn’t happened.

Start with your unemployment benefits. If your weekly check is $450 and you have 20 weeks left, that’s $9,000. Add severance, retirement withdrawals, investment income, and any other sources listed above. If you expect to be working again partway through the year, add those projected wages too. Someone who anticipates a $50,000 salary starting in July would include roughly $25,000 of expected wages on top of what came in from January through June.

For work patterns that bounce around, federal marketplace guidance is practical: report what you have now, review the yearly estimate the system generates, and update the application whenever something changes.² A reasonable, good-faith estimate is all that’s required. Nobody expects a perfect forecast.

One thing to keep in mind: household income includes your spouse’s earnings and any dependent’s income. If you’re unemployed but your spouse works full-time, the household MAGI may still be high enough to shrink or eliminate your subsidy.⁵

When Your Projected Income Routes You to Medi-Cal

If your projected MAGI lands at or below 138% of the Federal Poverty Level, Covered California sends you to Medi-Cal rather than a subsidized marketplace plan.⁶ For 2026, the single-person poverty guideline is $15,960, so the Medi-Cal cutoff works out to roughly $22,025 a year. For a family of four, the threshold is about $45,540.⁷

This catches a lot of newly unemployed applicants by surprise. Unemployment of $400 a week for 26 weeks is only about $10,400 for the year, well under the Medi-Cal line for a single adult. You wouldn’t get a subsidized Covered California plan in that situation because Medi-Cal is where you’d be enrolled instead.

One important distinction: Medi-Cal eligibility generally looks at current monthly income rather than a full-year projection. Even if you expect to return to a strong salary later in the year, your current low income can qualify you for Medi-Cal right now. When your earnings later climb above the threshold, you transition to a Covered California plan.

Updating Your Income After You Enroll

Because the subsidy is built on a projection, you’re required to tell Covered California when your income changes. Federal regulations give you 30 days to report any change,⁸ and Covered California enforces the same window.⁹ Changes that typically need reporting while you’re unemployed:

Starting a new job or picking up freelance work
Unemployment benefits running out
A lump-sum severance or retirement distribution
A spouse’s income going up or down
A dependent moving in or out of the household

Reporting a drop in income usually helps you. It can raise your monthly subsidy or move you to Medi-Cal, where coverage costs less. The real risk is the opposite: failing to report an income increase means you keep receiving more financial help than you qualify for, and you’ll owe the excess back at tax time.

Why Accurate Estimates Matter More in 2026

If you took Advance Premium Tax Credits during the year, you reconcile them on Form 8962 with your tax return, using the Form 1095-A that Covered California sends.¹⁰ If your actual income came in lower than estimated, you may get additional credit. If it came in higher, you repay some or all of the excess advance payments.¹¹

What changes for the 2026 tax year: the IRS previously capped how much excess credit you could be required to repay, based on your income level. Those caps are gone. Starting with tax year 2026, you repay the full difference between advance payments and your actual credit, with no limit.¹² If you lowball your estimate while unemployed and then return to a higher-paying job without updating your application, the repayment could be significant. That makes the two habits that run through this whole process (an honest annual projection and a prompt update when things change) matter more than they used to.

1
Covered California. Proof of Income
2
HealthCare.gov. What to Include as Income
3
Internal Revenue Service. Unemployment Compensation
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Covered California. What Counts as Income
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Covered California. How to Estimate Your Income
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Covered California. Program Eligibility by Federal Poverty Level for 2026
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HHS ASPE. 2026 Poverty Guidelines
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eCFR. 45 CFR 155.330 – Eligibility Redetermination During a Benefit Year
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Covered California. How to Update Your Account
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Internal Revenue Service. Premium Tax Credit: Claiming the Credit and Reconciling Advance Credit Payments
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Covered California. Financial Help Repayment Limits
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Internal Revenue Service. Updates to Questions and Answers about the Premium Tax Credit