Advance Payments of the Premium Tax Credit for 2020

May 24, 2021

Health Care

Changes for Taxpayers

Who Received an

Advanced Premium Tax Credit (APTC) for 2020

The American Rescue Plan Act (ARP) of 2021 suspends the requirement that taxpayers increase their tax liability by all or a portion of their excess advance payments of the Premium Tax Credit (excess APTC) for tax year 2020. A taxpayer’s excess APTC is the amount by which the taxpayer’s advance payments of the Premium Tax Credit (APTC) exceed his or her Premium Tax Credit (PTC).

The IRS recently announced that, for tax year 2020, taxpayers with excess APTC for 2020 are not required to file Form 8962, Premium Tax Credit, to reconcile their APTC with the amount of PTC they may claim for 2020. They should not report an excess advance Premium Tax Credit repayment on 2020 Form 1040 or Form 1040-SR, Schedule 2, Line 2, or file Form 8962.

Eligible taxpayers claiming a net Premium Tax Credit (net PTC) must file Form 8962 when they file their 2020 tax return. If the taxpayer’s PTC computed on the return is more than the APTC paid on the taxpayer’s behalf during the year, the difference is a net PTC. See the Form 8962, and its instructions for more information.

Understanding how recent legislative changes for the PTC affect individuals and families and their 2020 tax return is important. The IRS developed a fact sheet to explain what taxpayers need to know about claiming a net PTC and what to do if they have excess APTC for tax year 2020.

To read the full fact sheet, visit:

For more information, visit