What Is the Maximum Income to Qualify for Covered California?

For 2026, the maximum income to qualify for Covered California premium tax credits is 400 percent of the federal poverty level, which works out to roughly $62,600 for a single person and about $128,600 for a family of four. Earn a dollar more and you lose the federal subsidy entirely for the year. California also runs a separate state premium subsidy, but it is reserved for much lower incomes — at or below 165 percent of the poverty level.

2026 Income Cap by Household Size

Federal premium tax credits are available to households with income between 100 and 400 percent of the federal poverty level, provided no one in the household is eligible for other qualifying coverage such as an affordable employer plan or Medi-Cal. The 400-percent ceiling returned on January 1, 2026, after the Inflation Reduction Act’s enhanced subsidies expired on December 31, 2025.¹ From 2021 through 2025 there was no upper income limit; for 2026 the cap is back in force.²

Based on the 2025 federal poverty guidelines applied to the 2026 coverage year, the approximate income ceilings at 400 percent of the poverty level are:

1 person: $62,600
2 people: $84,600
3 people: $106,600
4 people: $128,600

Each additional person in the household raises the base poverty figure by roughly $5,500, which pushes the 400-percent threshold up proportionally.³ If your household income lands above the ceiling for your size, you cannot receive premium tax credits for 2026 and would pay the full, unsubsidized premium for any Covered California plan.²

In January 2026, the U.S. House voted to extend the enhanced credits for three more years, but that bill is still pending in the Senate. Covered California tells enrollees that “the federal government may bring back the extra financial help, but there’s no guarantee.”¹ If Congress does pass a retroactive extension, people who lost subsidies at the start of 2026 could become eligible again mid-year.

What Counts as Income

Covered California measures your household income using Modified Adjusted Gross Income, or MAGI. The starting point is the adjusted gross income on line 11 of your federal Form 1040, with certain items added back: tax-exempt interest, non-taxable Social Security benefits, and foreign earned income.⁴ Wages, tips, self-employment net earnings, and most retirement distributions all count. Child support, gifts, and Supplemental Security Income (SSI) are generally excluded.

MAGI is a projection of your full calendar year, not a snapshot of a single month. If you are self-employed or your income swings — gig work, commissions, seasonal jobs — federal marketplace guidance says to base your estimate on past earnings, realistic expectations, and industry norms rather than extrapolating from a particularly good or bad stretch.⁵ Getting the number close matters, because your estimated MAGI drives your subsidy, and a bad estimate shows up at tax time.

How Your Household Size Is Counted

The income cap moves with household size, so counting correctly is as important as projecting income accurately. Your household is based on your federal tax return, not simply who lives under your roof. It typically includes you, your spouse if you file jointly, and anyone you claim as a tax dependent — even dependents who do not need coverage.⁶

Shared-custody situations follow the tax return. You include a child in your household only for years you actually claim them as a dependent; in alternating-year arrangements, the child counts for whichever parent is claiming them that coverage year.⁷ Before you apply, check your most recent Form 1040 to confirm who was listed as a dependent.

The Lower Limit: When Medi-Cal Takes Over

Covered California subsidies have a floor as well as a ceiling. For most adults ages 19 through 64, Medi-Cal covers income up to 138 percent of the federal poverty level. At or below that line, you will generally be enrolled in Medi-Cal rather than a subsidized Covered California plan.⁸

For 2026, the approximate adult Medi-Cal income limits at 138 percent of the poverty level are:

1 person: $22,025
2 people: $29,864
3 people: $37,702
4 people: $45,540

Children and pregnant individuals qualify at higher thresholds. Children up to age 18 are eligible for Medi-Cal at income up to 266 percent of the poverty level, and pregnant individuals qualify up to 213 percent, with a separate program called MCAP covering pregnant individuals between 213 and 322 percent.⁸ In mixed households, children may land in Medi-Cal while the adults go into a subsidized Covered California plan.

Extra Help: The California State Premium Subsidy

Even though federal subsidies now stop at 400 percent of the poverty level, California added its own program for 2026 to protect the lowest-income enrollees from the loss of the enhanced federal credits. The state appropriated $190 million from the Health Care Affordability Reserve Fund for a state premium subsidy aimed at households at or below 165 percent of the poverty level.⁹

For enrollees up to 150 percent of the poverty level, the state subsidy preserves the zero-dollar premium contribution that was available under the expired federal enhancements. Those between 150 and 165 percent pay a reduced share of roughly 3.19 to 3.91 percent of income toward their premium. Above 165 percent of the poverty level, only the federal premium tax credit applies — there is no additional state help, even if you still qualify federally.⁹

The state subsidy is paid in advance each month alongside the federal credit, and it is reconciled separately on your California state return with the Franchise Tax Board. If your actual income differs from what you estimated, you may owe some back or receive additional credit.⁹

What Happens If You Underestimate Your Income

Because subsidies are based on your projected income, a year-end mismatch triggers reconciliation. If you received advance premium tax credits, you must file IRS Form 8962 with your federal return. Earn less than you projected and you may collect additional credit as part of your refund; earn more and you may owe some back.¹⁰

For households whose final income still comes in below 400 percent of the poverty level, repayment is capped:¹¹

Below 200% FPL: up to $375 (single filers) or $750 (all other filers)
200% to under 300% FPL: up to $975 (single) or $1,950 (other)
300% to under 400% FPL: up to $1,625 (single) or $3,250 (other)

If your final income lands at or above 400 percent of the poverty level, the cap disappears. You have to repay every dollar of advance credit you received during the year. That is why people whose income is near the ceiling should update Covered California as soon as a raise, a bonus, or a better quarter changes the picture, instead of waiting for tax season. Failing to file a return with Form 8962 can also disqualify you from receiving advance credits in future years.¹⁰

1
Covered California. Important Changes
2
Office of the Law Revision Counsel. 26 USC 36B – Refundable Credit for Coverage Under a Qualified Health Plan
3
HHS ASPE. 2025 Poverty Guidelines for the 48 Contiguous States and the District of Columbia
4
Internal Revenue Service. Modified Adjusted Gross Income
5
HealthCare.gov. Reporting Self-Employment Income to the Marketplace
6
Cornell Law Institute. California Code of Regulations Title 10 Section 6472
7
HealthCare.gov. Who’s Included in Your Household
8
Covered California. Program Eligibility by Federal Poverty Level for 2026
9
Covered California. 2026 California State Premium Subsidy Program
10
Internal Revenue Service. Premium Tax Credit – Claiming the Credit and Reconciling Advance Credit Payments
11
Internal Revenue Service. Instructions for Form 8962