I know there have been many discussions regarding these topics and trying to get clarity prior to year end and make the optimum tax moves this year. Here is my situation, first year fully retired from a tax perspective. ( Yahoo !!!)
I will have approximate income of 35K (line22). I have a HDHP that I will contribute max amount for 2014.
I get really confused about the amount of subsidy I will receive. When I signed up for ACA 2014, I used $50 K for income estimate. I paid premiums to insurance company and assume I will receive some kind of credit from Uncle Sam. I was hoping to get a jump on this 2014 tax prep, but does not appear software will be ready on time. I am travelling late in year, the price I must pay for being retired. I have been doing pro-forma tax returns with last year’s Turbo Tax. I understand concept for ACA, but need to see results in Turbo Tax and get confused between Kaiser Subsidy calculator and what shows in ACA website. Balance this with some possible Roth conversions and a headache follows.
Tax Info MFJ Using 2013 data: Standard deduction $12200 2 exemptions $7800
ACA Subsidy based on 50K estimate was $4932
IRA to Roth conversion amount assumes no taxes withdrawn at time of withdrawal.
State taxes not considered yet. Alltaxes based on 2013 Turbo taz
I assume it is to my advantage to optimize subsidy and skip the conversions?
|Conversion Amt Line 43 Line 37 Tax Refund w/o ACA|
| $65000 $92188 $72188 $-3855|
| $35000 $62188 $42188 $702|
| $10000 $37188 $17188 $4298|
| $00000 $27188 $ 7118 $5295|
Thank you for any input.