If it looks like someone is understating his income by more than 10%, and the exchange doesn’t have other sources to quickly check against, the exchange may choose to rely on what the applicant says.
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But in those cases, the exchange must also conduct a random sample of similar applicants to make sure the verification process is working.
In the end, if someone slips through the cracks — and gets more of a subsidy than he is entitled to — he still could be found out.
That’s because the exchanges are only approving estimated tax credits that a person can use to help pay their insurance, said Larry Levitt, a senior vice president of the Kaiser Family Foundation.
The final calculation of a subsidy’s size will be done after the fact by the IRS.
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