Many Arizonans would get smaller tax credits under Republican replacement to ObamacarePosted: Updated:
About 75 percent of Arizonans who get their health insurance through the federal marketplace get tax credits to make their premiums more affordable.
But under the Republican replacement to the Affordable Care Act, Arizonans making less than $50,000 would largely see smaller tax credits, according to estimates from the Kaiser Family Foundation.
The non-profit health policy organization released an online tool that estimates the size of premium tax credits in 2020 under both plans in every county. In general, the Republican plan gives larger tax credits to younger and wealthier people, and smaller tax credits to older and poorer people when compared to the ACA.
The foundation notes that people who live in states with high insurance premiums, specifically Arizona and Alaska, "receive larger tax credits under the ACA than they would under the American Health Care Act replacement."
The foundation estimated the size of tax credits for three ages of individuals – 27, 40, and 60 – and six income brackets ranging from $20,000 to $100,000.
The results are most striking for older Arizonans. A 60-year-old making $50,000 would get a smaller tax credit in every Arizona county under the Republican plan, losing out on more than $13,000 in assistance in Yavapai, La Paz and Yuma counties when compared to the ACA.
In other demographic groups, the results are more mixed. A 40-year-old making $50,000 per year would get a larger tax credit under the Republican proposal in Maricopa, Pima and Santa Cruz counties – between $930 and $3,000 more. However, the same individual living in Arizona’s 12 other counties would get a smaller tax credit than what the ACA offers – up to $2,500 less in Yavapai, La Paz and Yuma counties.
A 27-year-old making $50,000 would see tax credit benefits in Santa Cruz, Pima, Maricopa, Pinal and Gila counties under the Republican plan. The same individual would get fewer tax credits in the 10 other counties.
The reason for the county-by-county variance is the way tax credits are calculated in the Affordable Care Act. The ACA takes into account family income, local cost of insurance and age.
Under the Republican plan, tax credits for individuals making less than $75,000 per year are based entirely on age. Tax credits for individuals making more than $75,000 are incrementally phased out.
- $2,000 for people under 30
- $2,500 for people between 30 and 40
- $3,000 for people between 40 and 50
- $3,500 for people between 50 and 60
- $4,000 for people over 60
The $4,000 maximum tax credit under the Republican plan is significantly smaller than the largest estimated tax credits under the ACA: $21,710 in assistance for 60-year-olds making $20,000 in certain Arizona counties.
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