in the case of any individual described in the last 
sentence of such clause) without regard to subclause 
(II) thereof. 
‘‘(3) CREDIT ALLOWED TO CERTAIN LOW-IN-
COME EMPLOYEES OFFERED QUALIFIED SMALL EM-
PLOYER
HEALTH
REIMBURSEMENT
ARRANGE-
MENTS.—A qualified small employer health reim-
bursement arrangement shall not be treated as con-
stituting affordable coverage for an employee (or any 
spouse or dependent of such employee) for any 
months of a taxable year if the employee’s household 
income for such taxable year does not exceed 138 
percent of the poverty line for a family of the size 
involved. 
‘‘(4) LIMITATIONS ON RECAPTURE.— 
‘‘(A) IN GENERAL.—In the case of a tax-
payer whose household income is less than 200 
percent of the poverty line for the size of the 
family involved for the taxable year, the amount 
of the increase under subsection (f)(2)(A) shall 
in no event exceed $300 (one-half of such 
amount in the case of a taxpayer whose tax is 
determined under section 1(c) for the taxable 
year). 
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‘‘(B) LIMITATION ON INCREASE FOR CER-
TAIN NON-FILERS.—In the case of any taxpayer 
who would not be required to file a return of 
tax for the taxable year but for any require-
ment to reconcile advance credit payments 
under subsection (f), if an Exchange established 
under title I of the Patient Protection and Af-
fordable Care Act has determined that— 
‘‘(i) such taxpayer is eligible for ad-
vance payments under section 1412 of 
such Act for any portion of such taxable 
year, and 
‘‘(ii) such taxpayer’s household in-
come for such taxable year is projected not 
to exceed 138 percent of the poverty line 
for a family of the size involved, 
subsection (f)(2)(A) shall not apply to such tax-
payer for such taxable year and such taxpayer 
shall not be required to file such return of tax. 
‘‘(C) INFORMATION
PROVIDED
BY
EX-
CHANGE.—The information required to be pro-
vided by an Exchange to the Secretary and to 
the taxpayer under subsection (f)(3) shall in-
clude such information as is necessary to deter-
mine whether such Exchange has made the de-
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terminations described in clauses (i) and (ii) of 
subparagraph (B) with respect to such tax-
payer.’’. 
(b) EMPLOYER SHARED RESPONSIBILITY PROVISION 
NOT APPLICABLE WITH RESPECT TO CERTAIN LOW-IN-
COME TAXPAYERS RECEIVING PREMIUM ASSISTANCE.— 
Section 4980H(c)(3) of the Internal Revenue Code of 
1986 is amended to read as follows: 
‘‘(3) APPLICABLE PREMIUM TAX CREDIT AND 
COST-SHARING REDUCTION.— 
‘‘(A) IN GENERAL.—The term ‘applicable 
premium tax credit and cost-sharing reduction’ 
means— 
‘‘(i) any premium tax credit allowed 
under section 36B, 
‘‘(ii) any cost-sharing reduction under 
section 1402 of the Patient Protection and 
Affordable Care Act, and 
‘‘(iii) any advance payment of such 
credit or reduction under section 1412 of 
such Act. 
‘‘(B) EXCEPTION WITH RESPECT TO CER-
TAIN
LOW-INCOME
TAXPAYERS.—Such term 
shall not include any premium tax credit, cost- 
sharing reduction, or advance payment other-
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wise described in subparagraph (A) if such 
credit, reduction, or payment is allowed or paid 
for a taxable year of an employee (beginning 
after December 31, 2025, and before January 
1, 2029) with respect to which— 
‘‘(i) an Exchange established under 
title I of the Patient Protection and Af-
fordable Care Act has determined that 
such employee’s household income for such 
taxable year is projected to not exceed 138 
percent of the poverty line for a family of 
the size involved, or 
‘‘(ii) such employee’s household in-
come for such taxable year does not exceed 
138 percent of the poverty line for a family 
of the size involved.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2025. 
SEC. 4. FURTHER INCREASE IN FMAP FOR MEDICAL AS-
SISTANCE FOR NEWLY ELIGIBLE MANDA-
TORY INDIVIDUALS. 
Section 1905(y)(1) of the Social Security Act (42 
U.S.C. 1396d(y)(1)) is amended— 
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(1) in subparagraph (D), by striking at the end 
‘‘and’’; 
(2) in subparagraph (E), by striking ‘‘2020 and 
each year thereafter.’’ and inserting ‘‘2020, 2021, 
2022, 2023, 2024, and 2025;’’; and 
(3) by adding at the end the following new sub-
paragraphs: 
‘‘(F) 93 percent for calendar quarters in 
2026, 2027, and 2028; and 
‘‘(G) 90 percent for calendar quarters in 
2029 and each year thereafter.’’. 
Æ 
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