Eligible taxpayers can have 72.5 percent of their qualified health insurance premiums paid in advance directly to their health plan administrator each month. Each payment made on their behalf to the health plan administrator lowers their out-of-pocket premium costs.
Taxpayers may be eligible to elect the HCTC only if they are one of the following:
- An eligible trade adjustment assistance (TAA) recipient, alternative TAA recipient or reemployment TAA recipient,
- An eligible Pension Benefit Guaranty Corporation (PBGC) payee, or
- The family member of an eligible TAA, ATAA, or RTAA recipient or PBGC payee who is deceased or who finalized a divorce with them.
Once the registration is complete and they are enrolled in the Advanced Monthly Payment HCTC program, the taxpayer must pay 27.5 percent of their health insurance premiums in advance to the HCTC program. Payments are due by the 10th day of each month and must be made through the US Bank Lockbox system. The HCTC program then adds the 72.5 percent advance portion of the HCTC and sends the full payment to the health plan or third party administrator each month.
For more information, including a helpful set of questions and answers, visit IRS.gov/HCTC.