A little-known trap means that some families won’t be able to take advantage of the new tax subsidies created by the Affordable Care Act, commonly known as Obamacare.

Starting next year, Obamacare will provide tax credits to taxpayers who purchase health insurance on the open market if they earn less than 400% of the federal poverty level—that’s up to $94,200 for a family of four.

But you won’t qualify for those tax credits if you have access to affordable coverage through an employer’s plan—and the way the rules are written, “affordable” employer coverage might not actually be affordable for families.

The law considers a family to have access to affordable employer coverage if the employee in the family can obtain quality coverage for himself/herself at a cost of no more than 9.5% of the family’s annual household income. The rules don’t take into account the fact that many companies now subsidize health benefits for their employees much more than they do for those employees’ dependents. Thus an entire family might be disqualified from the tax credits, even though only one member of the family—the employee—truly has access to affordable employer coverage.

Potential solution: Families who find themselves in this trap should consider splitting up coverage…

  • The wage earner usually should sign up for coverage through the wage earner’s employer.
  • The kids likely can get a high-deductible health insurance policy through the individual market that will be relatively affordable even without tax credits.
  • The spouse might join the kids on that high-deductible policy—or he/she might find he isn’t caught in this trap at all. Companies that don’t subsidize dependents’ coverage often further economize by not offering spouses coverage at all. (They’re required to allow employees to include their kids on their health insurance but need not extend coverage to spouses.)

If the spouse isn’t eligible for the employer’s coverage, he is eligible for tax credits if he obtains insurance through the Obamacare health insurance exchanges, household income permitting.

For more information, go to Healthcare.gov/will-i-qualify-to-save-on-monthly-premiums or KFF.org/health-reform.