To amend the Internal Revenue Code of 1986 to extend the enhancement of the health care premium tax credit.

Bill Number

H.R. 6074

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Taxation

Status

Introduced

Latest Action

2025-11-18: Referred to the House Committee on Ways and Means.

Last Updated

2025-12-19T03:26:13Z

AI-Generated Summary

Purpose

This legislation aims to extend temporary enhancements to the health care premium tax credit, a subsidy that helps eligible individuals and families afford health insurance purchased through the Health Insurance Marketplace (established under the Affordable Care Act). These enhancements, originally set to expire at the end of 2025, would be prolonged to provide continued financial relief for premium costs.

Key Provisions

• Extension of Increased Premium Assistance: Amends Section 36B(b)(3)(A) of the Internal Revenue Code (IRC) to extend rules that boost the amount of premium tax credits available, changing the end date from December 31, 2025, to December 31, 2028.
• Extension for Higher-Income Households: Amends Section 36B(c)(1)(E) of the IRC to continue allowing premium tax credits for households with income exceeding 400% of the federal poverty line (a threshold that previously limited eligibility), also extending this through December 31, 2028.
• Effective Date: The changes apply to taxable years beginning after December 31, 2025, meaning they take effect for the 2026 tax year onward.

Significant Changes to Existing Law

• Under current law (as of the bill's introduction), the enhanced premium tax credit rules—introduced by the American Rescue Plan Act of 2021—increase subsidy amounts and eliminate the income cap above 400% of the poverty line, but these expire after 2025.
• This bill pushes the expiration to 2028, effectively maintaining broader and more generous subsidies without altering the core structure of the credit, which is calculated based on household income relative to the poverty line and the cost of a benchmark health plan.

Potential Impacts

• On Citizens: Low- and middle-income individuals and families (particularly those earning up to about $100,000–$150,000 annually, depending on household size and location) would continue to receive larger subsidies, potentially reducing out-of-pocket premium costs to zero for many and increasing health insurance enrollment. This could improve access to coverage and reduce uninsured rates.
• On Government Agencies: The Internal Revenue Service (IRS) would administer the extended credits through tax returns and advance payments, while the Department of Health and Human Services (HHS) might see indirect effects via Marketplace operations. It could increase federal spending by billions annually (based on prior estimates for similar extensions), contributing to the federal budget deficit.
• On International Relations: No direct impacts, as this is a domestic tax and health policy measure.

Main Stakeholders Affected

• Individuals and Families: Primary beneficiaries are Marketplace enrollees, especially those with moderate incomes who would otherwise face higher premiums after 2025.
• Health Insurers and Providers: Insurers may see sustained enrollment growth, stabilizing their risk pools; providers could benefit from fewer uninsured patients.
• Taxpayers and Government: Broader taxpayers fund the credits via federal revenue; agencies like the IRS and HHS handle implementation.
• Advocacy Groups: Organizations focused on health access (e.g., consumer advocates) support it, while fiscal watchdogs may oppose due to costs.

Notable Legal, Constitutional, or Political Implications

• Legal: The bill makes straightforward amendments to the IRC, requiring no major reinterpretation of tax law. It builds on existing Affordable Care Act frameworks without challenging their validity.
• Constitutional: No apparent issues, as it involves Congress's enumerated powers to tax and spend for the general welfare.
• Political: As an extension of pandemic-era relief tied to the Affordable Care Act, it could spark partisan debate over health care affordability and federal spending. Passage would signal bipartisan or Democratic priorities on social safety nets, potentially influencing midterm election dynamics in 2026. The bill's referral to the House Ways and Means Committee underscores its focus on tax policy implications.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Underwood, Lauren [D-IL-14]

Recent Actions

• 2025-11-18: Referred to the House Committee on Ways and Means.
• 2025-11-18: Introduced in House
• 2025-11-18: Introduced in House

Bill Versions

• To amend the Internal Revenue Code of 1986 to extend the enhancement of the health care premium tax credit. — issued 2025-11-18 — PDF (2 pages)