Your Clients’ Income Estimates Matter More Than Ever

“How much do you expect to make next year?” If you sell individual health insurance, you ask that question all the time. And during a busy open enrollment season, “probably about the same as this year” can sound like a perfectly reasonable answer.

But before you move on to comparing plans, it’s worth spending a few more minutes on that number. Your client may have more riding on it than they realize.

The Repayment Limits Are Gone

According to the IRS’s premium tax credit guidance, the limits on repaying excess advance premium tax credits no longer apply beginning with tax year 2026. Clients must repay the full difference between the advance credits paid on their behalf and the credit they actually qualify for.

Previously, repayment caps could protect households with an annual income below 400% of the federal poverty level. That protection is gone.

This already affects 2026 coverage, with reconciliation on tax returns filed in 2027. It also matters as you help clients estimate income for their 2027 applications.

A Small Conversation Can Prevent a Big Surprise

Suppose a client receives $9,000 in advance premium tax credits during 2026 but qualifies for only $6,000 when they file their return. They would have to repay the entire $3,000 excess.

That could mean a smaller refund or a larger tax bill. Either way, it’s a conversation your client would probably rather have now.

Ask a Few More Questions

As HealthCare.gov explains, Marketplace savings are based on expected household income for the coverage year. Last year’s tax return can be a starting point, but the estimate needs to reflect what’s expected for the coming year.

Is the client anticipating a raise? Has their spouse started working? Is their business growing? Are they planning a taxable retirement account withdrawal?

Also, make sure you’re talking about the right kind of income. The Marketplace uses modified adjusted gross income, or MAGI. For self-employed clients, business revenue and income after business expenses are very different numbers.

You don’t need to predict every dollar, but you do need a thoughtful estimate.

Keep the Conversation Going

Tell clients to contact you when their income or household circumstances change, and help them update their Marketplace application promptly. Consider a midyear reminder, especially for clients with commissions, seasonal work, or self-employment income.

Clients with unpredictable income can also choose to use only part of their estimated tax credit in advance. That means paying more each month, but it can reduce the risk of owing money later. And if they do qualify for more than they receive in advance, the additional amount will show up on their income tax return.

During this renewal season, it’s a good idea to review their current 2026 information as well as their 2027 estimate.

Helping someone find an affordable premium is valuable. Helping them understand what that premium is based on, and when to revisit it, gives them another reason to keep working with you.