Federal Poverty Level

An income yardstick, not a label

The federal poverty level, or FPL, is a set of income figures published every year by the U.S. Department of Health and Human Services. Despite the name, it is used across many programs, and for health insurance buyers its main job is to measure where your income sits for premium tax credits.

The Marketplace expresses your projected household income as a percentage of FPL. That percentage decides how much you are expected to contribute toward the benchmark silver plan, and whether you qualify for a credit at all.

Which year's numbers apply

Marketplace coverage uses the prior year's guidelines. For 2027 coverage, that means the 2026 HHS guidelines, which start at $15,960 for a household of one in the 48 contiguous states, with an added amount for each additional person.

The numbers that matter most

For people buying their own coverage, the key threshold is 400% of FPL, the upper limit for the premium tax credit in 2027:

• 1 person: $63,840.
• 2 people: $86,560.
• 3 people: $109,280.
• 4 people: $132,000.

Below that line, your expected contribution is a percentage of income, ranging from 2.15% to 10.22% for 2027 under IRS Rev. Proc. 2026-26. Above it, there is no credit.

Cost-sharing reductions on silver plans apply at lower income levels, up to 250% of FPL.

Example

Jasmine and Kevin, both 61, retired early from careers in sales. Their projected 2027 income from part-time consulting, a pension and investment withdrawals is about $82,000.

• Their household of two has a 400% line of $86,560.
• At $82,000, they are just under the line, so they qualify for a premium tax credit.
• If they sell stock and realize a $10,000 gain, their income jumps to $92,000, over the line, and they lose the entire credit.

Knowing their FPL percentage helps them plan the timing of withdrawals and gains.

Household size matters

FPL is based on your tax household, which includes you, your spouse if filing jointly, and dependents you claim. Adding a baby or a dependent raises your threshold.

Marketplace vs private plans

FPL only matters for Marketplace subsidies. If your income is well above 400% of FPL, the comparison becomes full-price Marketplace plans against private plans, where your health, network needs and budget drive the decision.

See our guides on the 2027 ACA subsidy cliff and health insurance without a subsidy. To find out where your income lands, request a quote.