Your eligibility for financial assistance through Pennie is based on your expected household income for the year you want coverage, not last year's income. You must make your best estimate of your income for the year you want coverage on your Pennie application so you qualify for the right amount of financial assistance to help pay for the cost of health coverage and care.
Whose income to include in your estimate
For most people, a household consists of the tax filer, their spouse if they have one, and their tax dependents, including those who are not applying for coverage.
What income is counted
Pennie uses an income number called modified adjusted gross income (MAGI) to determine eligibility for financial assistance.
The chart below shows common types of income and whether they count as part of MAGI. If you expect income types not shown or have additional questions, see details on what the IRS counts as income.
| Income type | Include as income? | Notes |
|---|---|---|
|
Federal Taxable Wages (from your job) |
Yes |
If your pay stub lists “federal taxable wages,” use that. If not, use “gross income” and subtract the amounts your employer takes out of your pay for child care, health insurance, and retirement plans. |
|
Tips |
Yes |
|
|
Self-employment income |
Yes |
Include “net self-employment income” you expect — what you’ll make from your business minus business expenses. Note: You’ll be asked to describe the type of work you do. If you have farming or fishing income, enter it as either “farming or fishing” income or “self-employment,” but not both. |
|
Unemployment compensation |
Depends |
Include all unemployment compensation except the extra $300 weekly you may be getting in federal pandemic unemployment compensation due to the coronavirus disease 2019 (COVID 19) emergency. The date it ends varies by state. Visit CareerOneStop's Unemployment Benefits Finder |
|
Social Security |
Yes |
Include both taxable and non-taxable Social Security income. Enter the full amount before any deductions. |
|
Social Security Disability Income (SSDI) |
Yes |
But do not include Supplemental Security Income (SSI). |
|
Retirement or pension Income |
Yes |
Include most IRA and 401k withdrawals. (See details on retirement income in the instructions for IRS publication 1040). Note: Don’t include qualified distributions from a designated Roth account as income. |
|
Alimony |
Depends |
Divorces and separations finalized before January 1, 2019: Include as income. Divorces and separations finalized on or after January 1, 2019: Don’t include as income. |
|
Child support |
No |
|
|
Capital gains |
Yes |
|
|
Investment income |
Yes |
Include expected interest and dividends earned on investments, including tax-exempt interest. |
|
Rental and royalty income |
Yes |
Use net rental and royalty income. |
|
Excluded (untaxed) foreign income |
Yes |
|
|
Economic Impact/Stimulus Payments (come from the IRS as a result of the COVID-19 emergency) |
No |
|
|
Gifts |
No |
|
|
Supplemental Security Income (SSI) |
No |
But do include Social Security Disability Income (SSDI). |
|
Veterans’ disability payments |
No |
|
|
Worker’s Compensation |
No |
|
|
Proceeds from loans (like student loans, home equity loans, or bank loans) |
No |
|
|
Child Tax Credit checks or deposits (from the IRS) |
No |
Reporting changes
If your income changes during the year, make sure to update your Pennie application to ensure you continue to receive the right amount of financial assistance. See the “What should I do if I experience a change in income or another change in circumstance during the year?’ FAQ for additional information.