When does the Marketplace tax credit end at 65?
The premium tax credit ends once you can get premium-free Medicare Part A, under 26 CFR 1.36B-2(c)(2). Most people qualify for premium-free Part A at 65 because they or a spouse worked about 10 years in jobs that paid Medicare taxes. Cost-sharing reductions end at the same time.
CMS’s July 2026 Marketplace to Medicare training sets out when the credit stops:
| Your situation | When the Marketplace credit stops |
|---|---|
| Automatically enrolled in Medicare (already getting Social Security or railroad retirement benefits) | The first day of the month you turn 65 |
| Must sign up for premium-free Part A yourself | The first day of the first full month you can use Medicare |
| Eligible for premium-free Part A but never sign up | The credit still ends: CMS treats you as eligible |
| Would have to pay a premium for Part A and don’t enroll | The credit continues |
| Would have to pay for Part A and do enroll | The month Medicare starts |
Medicare Part B alone doesn’t count as minimum essential coverage, according to the same CMS training.
When is your Medicare Initial Enrollment Period?
Medicare’s Initial Enrollment Period lasts 7 months: the 3 months before the month you turn 65, that month, and the 3 months after. Medicare.gov says coverage always starts on the first of a month.
Here is one 2027 example, worked by Coverage Decider from those rules. Someone turns 65 on May 15, 2027, signs up themselves, and has a HealthCare.gov plan:
| Signs up for Medicare in | Part B starts | Marketplace credit ends |
|---|---|---|
| February, March or April 2027 | May 1, 2027 | May 1, 2027 |
| May 2027 | June 1, 2027 | June 1, 2027 |
| June 2027 | July 1, 2027 | July 1, 2027 |
| July 2027 | August 1, 2027 | August 1, 2027 |
| August 2027 | September 1, 2027 | September 1, 2027 |
Premium-free Part A can be dated back to May 1, 2027 in each row. CMS’s own worked example still ends the credit on the day Part B starts, the first full month the person can use Medicare.
The Initial Enrollment Period in this example ends August 31, 2027. A birthday on the first of the month moves everything a month earlier: CMS says the period then starts 4 months before the birthday.
How do you move from a Marketplace plan to Medicare?
HealthCare.gov says Marketplace coverage doesn’t end automatically when Medicare starts. These steps follow HealthCare.gov and CMS:
- Sign up for Medicare early. If you aren’t automatically enrolled, apply during the 3 months before your birthday month so Medicare starts the month you turn 65.
- Update your Marketplace application. Log in to HealthCare.gov and answer “yes” to the question about starting Medicare. You can enter a start date up to 3 months ahead, or one in the past.
- Give the Medicare Part A or Medicare Advantage start date. The Marketplace then ends your plan the day before Medicare starts.
- Act on any letter within 30 days. If the Marketplace finds you have Medicare and you haven’t updated your application, HealthCare.gov says it will change your coverage based on what it knows.
Since March 2025, the HealthCare.gov application lets one person leave for Medicare while the rest of the household stays enrolled, according to CMS.
What happens to a younger spouse’s Marketplace plan?
A spouse under 65 can keep a Marketplace plan with the tax credit after the older spouse moves to Medicare. Under 26 U.S.C. 36B(d), the credit counts everyone in the tax household, including the spouse on Medicare. That spouse’s income still counts too.
CMS’s training lists three things to watch:
- The credit amount can change. The household’s advance credit and monthly premium are recalculated.
- A new plan may be possible. If the remaining enrollees qualify for a Special Enrollment Period, they can pick a new plan.
- The deductible may start over. If the spouse moving to Medicare was the subscriber on the policy, the insurer may reset deductibles for everyone still enrolled.
Coverage Decider’s calculator shows the 2027 tax credit for the spouse who stays.
Can you keep a Marketplace plan instead of Medicare?
You can keep a Marketplace plan after Medicare starts, but HealthCare.gov says you’ll pay full price and your insurer may end it. It is also against the law for someone who knows you have Medicare to sell you a Marketplace plan, even with only Part A or only Part B.
The real choice is for people who would have to pay a premium for Part A. Under the CMS training, they can skip Medicare and keep the Marketplace plan with the tax credit, as long as income is between 100% and 400% of the poverty line. Over 400%, the 2027 subsidy cliff means no credit at any price.
HealthCare.gov tells this group to compare costs and coverage and weigh Medicare’s late penalties. Many qualify for a Medicare Savings Program, which can pay Part A and Part B premiums, according to CMS.
What do Medicare’s late penalties cost?
Marketplace coverage doesn’t protect you from Medicare’s late penalties. HealthCare.gov says that in most cases you’ll pay penalties for Part B and Part D if you sign up late. A Marketplace plan also doesn’t give you Medicare’s 8-month Special Enrollment Period, which only follows job-based coverage. Medicare.gov sets the penalties:
| Part | Late penalty | How long |
|---|---|---|
| Part A (only if you pay a premium for it) | 10% more | Twice the number of years you didn’t sign up |
| Part B | 10% for each full 12 months you could have had Part B | Usually for as long as you have Part B |
| Part D | 1% for each month without creditable drug coverage, after 63 days or more | As long as you have Medicare drug coverage |
Medicare.gov gives a 2026 example: a 2-year delay adds 20% to the $202.90 standard Part B premium, for $243.50 a month. CMS had not announced the 2027 Part B premium as of October 28, 2026.
What if you miss the Initial Enrollment Period?
Miss the Initial Enrollment Period and you may have to wait for Medicare’s General Enrollment Period, January 1 to March 31 each year. Medicare.gov says coverage then starts the month after you sign up, and a late penalty may apply.
Premium-free Part A can also start in the past. CMS says that if you sign up after your Initial Enrollment Period, Part A can go back up to 6 months, but not before the month you turned 65. Any month with both Part A and advance credit payments can mean paying the credit back. From tax year 2026, repayment has no cap.
Who decides your dates?
Rules here are as of October 28, 2026, and this is not legal or tax advice. Social Security and Medicare.gov decide your Medicare start dates. HealthCare.gov decides your Marketplace coverage and credit. How we calculate lists the rules Coverage Decider uses. Free local help can check your situation at no cost, and your State Health Insurance Assistance Program gives free Medicare counseling.