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Cap Gain Impact on MAGI under ACA?
Old 10-04-2013, 12:05 PM   #1
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Cap Gain Impact on MAGI under ACA?

Am I correct in assuming that taking long-term capital gains equal to or less than carryover long-term losses will not impact MAGI for the purpose of the ACA?

Also, what are the rules for short-term carryover losses. Can they be used to offset additional long-term gains?
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Old 10-04-2013, 12:26 PM   #2
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I am not an expert, but I believe MAGI is MAGI- no special adjustments regarding cap gains.

This is one of the better summaries I have seen:
http://laborcenter.berkeley.edu/heal..._summary13.pdf
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Old 10-04-2013, 12:36 PM   #3
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Quote:
Originally Posted by NoMoreJob View Post
Am I correct in assuming that taking long-term capital gains equal to or less than carryover long-term losses will not impact MAGI for the purpose of the ACA?

Also, what are the rules for short-term carryover losses. Can they be used to offset additional long-term gains?
On the first question, I would think yes (LTCG<=LTCL carryovers would not affect O-MAGI) since LTCG are offset by LTCL carryforwards in determining AGI for the year and the calculation of O-MAGI begins with AGI.

I haven't seen anything that says they are carved out so I think for both types of capital loss carryforwards that they will follow the 1040 treatment for O-MAGI purposes. This will be a big advantage for people with big capital loss carryforwards.
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Old 10-04-2013, 12:41 PM   #4
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probably should be AGI is AGI since there are many MAGIs for different purposes but the idea is the same.......so answer should be yes and yes
since LT and ST CGs get netted against each other...............except if you start eating into the last 3K of loss carryovers. Before that the CG contribution to MAGI will be -3K (a loss) ; as the gains increase, that loss can decrease so that MAGI will eventually increase.
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