Question

Large Sum Payment Mid Year

Forum|Forum|1 year ago
February 21, 2025
1 reply
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We received an opportunity for a large sum payment in June 2024, which we took. We have affordable care for 2024. When we are paying our taxes it is taking our whole year income and applying it at adjusted gross income to calculate any underpayment for ACA. IS there a way to show this mid year payment, without having to pay a penalty for the first five months of the year when we had significantly smaller income. In essence our taxes are being treated as if we made the income throughout the entire year. Any help is appreciated.

V

Vanessa A

No. The Premium Tax Credit is based on your total income for the year. This means even if the first several months of the year you have little income and then hit the jackpot in December, your Premium Tax Credit would be based on your TOTAL income for the year.

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