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Tax Realities for Self-Employed Who Get Obamacare Subsidies

Tax Realities for Self-Employed Who Get Obamacare Subsidies
Photograph by Getty Images

Since I wrote a recent explainer about government subsidies for self-employed individuals who purchase health coverage through the Obamacare insurance marketplaces, many readers have followed up with tax-related questions. (In a nutshell, the Affordable Care Act subsidies I described are available to individuals making up to about $45,000 annually and four-person households bringing in about $94,000.) Here are a few answers on how self-employed individuals’ taxes will be affected.

Question: If a self-employed individual gets a subsidy for an insurance purchase on the exchange, is that subsidy treated as income for tax purposes? Will I get a 1099 for that amount?