If you're self-employed, you can use the individual Health Insurance Marketplace to enroll in flexible, high-quality health coverage that works well for people who run their own businesses.
You can enroll through the Marketplace if you’re a freelancer, consultant, independent contractor, or other self-employed worker who doesn’t have any employees.
You can choose from several categories of coverage, from plans with low premiums that mainly protect you in worst-case scenarios to plans where you’ll pay more each month but less out-of-pocket when you get health care services.
You’re considered self-employed if you have a business that takes in income but doesn’t have any employees. If your business has even one employee (other than yourself, a spouse, family member, or owner), you may be able to use the SHOP Marketplace for small businesses to offer coverage to your employees. See “How do I know if I’m self-employed or a small employer?” to learn more.
Marketplace savings are based on your estimated income for the year you’re getting coverage.
When you fill out a Marketplace application, you’ll have to estimate your net income for the year you want coverage. (See “Reporting net income” below to understand what income to report.)
When you’re self-employed, it may be hard to estimate your income.
It’s very important to update your estimated annual income when your business circumstances change. If you wind up making more than you reported on your Marketplace application, you could have to pay back some or all of the premium tax credits you took during the year. If you wind up making less, you could qualify for more savings than you claimed during the year.
On your Marketplace application, you’ll be asked to report your net income from your self-employment. (Net income is sometimes called “profit.”)
Your net income is the difference between your self-employment income and your business expenses.
Your net income from self-employment is what you report on Schedule C of your federal tax return. Learn about income from self-employment from the IRS (PDF).
When you apply for Marketplace coverage, you must report income from everyone in your household. Learn who to count in your household and how to report other kinds of income.
If you don’t have coverage, you’ll pay a penalty
If you run a business that produces income and has no employees, you’re considered self-employed. You can buy health coverage through the individual Health Insurance Marketplace.
You’re not considered an employer even if you hire independent contractors to do some work.
“Employees” are generally defined as workers whose income you report on a W-2 form at the end of the year.
Get details about how to know if people who work for you are considered employees.
If you lose job-based coverage for any reason, you qualify for a Special Enrollment Period. This means you can enroll in a health plan even if it’s outside the annual Open Enrollment period. Learn more about how to apply with a Special Enrollment Period.
You can cancel your Marketplace plan and enroll in your employer’s insurance.
Once you have an offer of job-based coverage, in most cases you’ll no longer qualify for premium tax credits and other savings on a Marketplace plan. This true whether you enroll in the job-based coverage or not.
In some cases, your employer’s coverage won’t be considered affordable to you or won’t meet minimum standards. If this is true, you may qualify for premium tax credits and other savings on a Marketplace plan. Learn about your options if you have an offer of job-based coverage.
If your spouse’s plan offers coverage to spouses and dependents, in most cases you won’t qualify for premium tax credits and other savings on a Marketplace plan.
If your spouse’s job-based insurance doesn’t cover spouses and dependents, then you can buy a Marketplace plan for you and your dependents. Depending on your household income, you may qualify for premium tax credits and other savings. Remember, if you want Marketplace savings, you and your spouse must file a joint tax return and report all household income, not just yours, even if your spouse doesn’t need coverage. Learn more about reporting household income.
If you currently have COBRA continuation coverage, your options are different during the annual health insurance Open Enrollment period and outside Open Enrollment. Learn about COBRA and the Marketplace.