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Old 08-30-2016, 02:05 PM   #21
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Right that's the way I understand it, I think there is some mixing of income add on and deductions and stuff on this thread that is confusing....Sue J had the best link to explanation in my opinion. , the number is your gross income and very few things count as deductions for ACA purposes.

For example I usually have some over payment on my state tax, but I don't ever have the amount listed in line 10...so it's not income.
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Old 08-30-2016, 02:08 PM   #22
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Originally Posted by scrabbler1 View Post
I agree that it doesn't make sense, especially when the taxpayer has no control over the timing of the overpayment versus the refund/rebate.
I agree it does not make sense to include prior year state tax refunds where one itemized in the prior year in MAGI, but nonetheless that is the way it is defined.
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Old 08-30-2016, 02:14 PM   #23
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A refund shows up as income regardless of how you do deductions.
So the instructions for line 10. clearly state the refund only has to be reported as income if it was deducted in a previous year.So I have to disagree with this.
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Old 08-30-2016, 02:27 PM   #24
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Originally Posted by zinger1457 View Post
The income used to determine the ACA subsidy is the Modified Adjusted Gross Income which for most people is just the AGI (line 37 on 1040). To get MAGI add the following to your AGI:
  • Tax-exempt foreign income
  • Tax-exempt Social Security benefits (including tier 1 railroad retirement benefits)
  • Tax-exempt interest
I would suggest you use one of the ACA subsidy calculators to get an estimate, I've used the Kaiser Family Foundation calculator and it seems to be accurate.
Health Insurance Marketplace Calculator | The Henry J. Kaiser Family Foundation
Thanks so much for this link zinger.
Something very similar to this was available at my state aca healthcare website at one time, but was taken down ?
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Old 08-30-2016, 02:41 PM   #25
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So the instructions for line 10. clearly state the refund only has to be reported as income if it was deducted in a previous year.So I have to disagree with this.
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Old 08-30-2016, 05:46 PM   #26
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Keep in mind also that HSA contributions, IRA contributions, reduce MAGI (essentially the number on bottom row of Page 1 of your annual 1040 Form).

So, as a simple&rough example, assume W-2 income + Interest totals 25,000 for a household of 2 adults and they contributed 3000 to traditional IRA and 1000 to an HSA, then MAGI would be 21,000 and they would qualify for almost nill monthly payment within a Silver Plan which would include a Tax Subsidy AND it would also include a Cost sharing reduction with a modest annual max deduction.
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Old 09-01-2016, 06:17 PM   #27
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Keep in mind also that HSA contributions, IRA contributions, reduce MAGI (essentially the number on bottom row of Page 1 of your annual 1040 Form).

So, as a simple&rough example, assume W-2 income + Interest totals 25,000 for a household of 2 adults and they contributed 3000 to traditional IRA and 1000 to an HSA, then MAGI would be 21,000 and they would qualify for almost nill monthly payment within a Silver Plan which would include a Tax Subsidy AND it would also include a Cost sharing reduction with a modest annual max deduction.
One clarification on IRA contributions: only deductible IRA contributions reduce MAGI. Roth IRA and non-deductible regular IRA contributions do not reduce MAGI.
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Old 09-02-2016, 06:21 AM   #28
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Keep in mind also that HSA contributions, IRA contributions, reduce MAGI (essentially the number on bottom row of Page 1 of your annual 1040 Form).

So, as a simple&rough example, assume W-2 income + Interest totals 25,000 for a household of 2 adults and they contributed 3000 to traditional IRA and 1000 to an HSA, then MAGI would be 21,000 and they would qualify for almost nill monthly payment within a Silver Plan which would include a Tax Subsidy AND it would also include a Cost sharing reduction with a modest annual max deduction.
not sure if this is high enough in a state with expanded medicaid. In that case you may end up on medicaid.

Don't forget adding back tax exempt income, capital gains, and dividends.
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Old 09-02-2016, 06:40 AM   #29
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Yes, according to the Kaiser calculator for US average, $21k income, 2 adults:

Quote:
RESULTS
If Your State Decides to Expand Medicaid

States have the option to expand Medicaid coverage to everyone under 138% of the poverty level. If a state expands Medicaid, most of the costs are covered by the federal government under the health reform law. If your state decides to expand Medicaid, your income will make you eligible for the program. Medicaid coverage varies from state to state, but out-of-pocket costs are generally very low. Tobacco use is never taken into account in Medicaid eligibility.

If Your State Decides Not to Expand Medicaid

If your state decides not to expand Medicaid, you or some members of your family may still be eligible for coverage, depending on your state’s eligibility criteria. Visit Healthcare.gov, your state’s Health Insurance Marketplace or Medicaid office for more information.

You may be eligible for financial assistance through the Health Insurance Marketplace. Financial assistance is only available to people with incomes between 100% and 400% of the poverty level. The information below is an estimate of what you would pay for subsidized Marketplace coverage in 2016:
  • Estimated financial help: $562 per month ($6,748 per year)
    as a premium tax credit. This covers 94% of the monthly costs.
  • Your cost for a silver plan: $36 per month ($426 per year) in premiums (which equals 2.03% of your household income).
  • The most you have to pay for a silver plan: 2.03% of income for the second-lowest cost silver plan
  • Without financial help, your silver plan would cost: $598 per month ($7,174 per year)
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Old 09-02-2016, 07:24 AM   #30
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To be precise, the FPL for 2016, which will be used for 2017 ACA premium assistance, is $16020 for a family of two (source here). If OP lives in a Medicaaid expansion state they would need MAGI of 138% of that number, or $22107, to be eligible for premium assistance on the exchange. If they live in a non-expansion state, they would need just the $16020. As pb4uski highlighted, at those levels of income they also would be eligible for cost sharing.
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Old 09-02-2016, 07:42 AM   #31
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And of course, depending on your state, at a certain age if you go on Medicaid they will file a lien against your estates for payment upon your demise.
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