Documents to provide for ACA coverage 2018

[littleb]

We retired in June of this year so next year will be the first year we will be eligible for Health Care subsidies through the ACA.

I spoke to an ACA rep and she told me to provide tax documents from prior year. Well, prior year shows our income above the 65,000 cut off to be eligible for a subsidy. This makes no sense.

The plan is to take 25,000 from an IRA and use dividends and interest to complete our 2018 income. We do not want to pay the health premium up front because the money would need to come from an IRA and would be taxed.

What documents are required to determine your MAGI for the next year? Is a spreadsheet with estimated interest, dividends and estimated IRA distribution sufficient? Do you include all tax deductions on the spreadsheet to get the estimated total MAGI? Or does Healthcare.gov need actual copies from Vanguard, Ally, etc with a detailed explanation of where the money comes from?

Should we also send a letter stating we retired in June 2017?

 

[gayl]

OMG sounds like FAFSA --- so glad I'm not ACA

 

[RunningBum]

I started a thread on this last year: http://www.early-retirement.org/for...ibility-notice-how-to-prove-income-84273.html
The first response has pointers to other threads, which I didn't follow today but apparently found useful last year.

The bottom line was that they accepted a written explanation of why I expected the next year to be different from the previous year's doc that I provided, and what I expected the new numbers to be.

 

[HadEnuff]

In NY State, last year I just had to explain the reason for the difference, i.e. "retirement"..

Of course, if I was wrong, and I received the monthly subsidy, and then turned in a 1040 with a much higher MAGI than I had predicted, I'd be getting a bill for the amount of the subsidy I was not eligible for.

 

[pb4uski]

I seem to recall people running into this before and jsut having to explain that they retired in June 2017 so their 2016 tax return is not relevant or indicative of their income for 2018, and explaining what they expect their income to be for 2018.... you could even take the 2016 tax return AGI and reduce it by earned income (now retired) and add in the planned IRA withdrawals and any other relevant adjustments.

 

[ShokWaveRider]

This is another reason to use and agent. They do not need any documentation. Or at least mine never asked for any in the last 3 enrolment years.

 

[RunningBum]

This is another reason to use and agent. They do not need any documentation. Or at least mine never asked for any in the last 3 enrolment years.

I used an agent and had to provide the doc. I don't see how an agent can override what the govt requires. I don't recall if healthcare.gov has access to your tax returns and as long as your income had been low enough you wouldn't need to provide more. Mine was higher and I needed to give that explanation that it wouldn't be for the next year.

 

[joeea]

I spoke to an ACA rep and she told me to provide tax documents from prior year. Well, prior year shows our income above the 65,000 cut off to be eligible for a subsidy. This makes no sense.

What documents are required to determine your MAGI for the next year? Is a spreadsheet with estimated interest, dividends and estimated IRA distribution sufficient? Do you include all tax deductions on the spreadsheet to get the estimated total MAGI? Or does Healthcare.gov need actual copies from Vanguard, Ally, etc with a detailed explanation of where the money comes from?

Should we also send a letter stating we retired in June 2017?

When I spoke to the ACA rep, I explained that I had retired in the current year and thus my last year's taxes were not representative of next year's income.

She just made a note on my record and needed nothing further.

It turned out that I accepted a consulting gig and earned enough income that I had to pay back our subsidies. Oh well.

Again this year. I was asked to provide "proof of income". Once again I explained that, since the consulting was complete, I would have no income next year, but my taxes couldn't show that. This time she asked that I send a "self-attestment" letter to that effect.

I did so. I don't expect problems, but we'll see.

BTW, getting subsidized is a pretty sweet deal. Very good coverage for less than I was playing while employed.
I thank you all. My wife and my financial planner thank you all as well.

 

[Murf2]

I sign up on the website. Easy to use & I've never needed any paperwork. I just put in my estimated income, they have several options for where the money comes from. IIRC, I chose " investments". Never heard anything back & got my insurance.


Good luck,
Murf

 

[sengsational]

I had this problem on the first year of the PPACA. I was asked to provide documentation, which I did, in the form of documents from my former employer that indicated I'd quit. They kept on asking, I kept on uploading. Finally, I sent paper copies and they stopped nagging me.

 

[ShokWaveRider]

I used an agent and had to provide the doc. I don't see how an agent can override what the govt requires. I don't recall if healthcare.gov has access to your tax returns and as long as your income had been low enough you wouldn't need to provide more. Mine was higher and I needed to give that explanation that it wouldn't be for the next year.

All I can say is what I have experienced. Florida Blue has a monopoly here in FL. My Agent does not work for Florida Blue, but only works with Florida Blue. I do not profess to understand the relationship, but it seems to work.

I always check what is available on the Exchange, and all the plans she recommends are all there. She does always suggest the cheapest for me, with the maximum subsidies and CSRs. So far she has NOT disappointed.

I can let you know better tomorrow when we meet to finalize the 2018 coverage.

 

[SheitlQueen]

I was in the same boat. I provided a written explanation that I had retired and would not have the income that I had in prior years. I sent in a copy a letter stating my SS payments and a breakdown of income from rental units...and a copy of my dividends from Fidelity for the prior year. They accepted it all with out question.

 

[jim584672]

I went from high income to minimal income and wasn't asked for any docs. I guess they can check it electronically.

 

[RunningBum]

Sounds like it's random, based upon the whim of whoever looks at the application. I didn't offer any doc, and was specifically asked for proof, so then I had to provide an explanation. Anyway, the advice holds. Put down the income you expect. If you get asked, write a letter explaining why it'll be what you say. It shouldn't be a problem, just an extra step if you get asked. The earlier you apply, the quicker it'll get resolved. Or, maybe if you wait until they get swamped, they'll take a quick look at yours and let it go. Who knows?

 

[littleb]

I appreciate all the feedback and based on everyone's experience it looks like once the application is updated with the new 2018 plan the process will not be difficult to complete.

My friend did not have to provide any documentation when she updated her application last year with a reduced MAGI. It must be based on the state where you reside.

If they ask for additional documents I will provide a letter and copies of prior dividend and income statements. In the first year or two of the ACA it had glitches where people gave up trying to explain their employment situation or income sources. Many people paid the full premiums and reconciled at tax time. It looks like the ACA worked through many of these issues.

Btw, I tried to sign up at 3:00 am this morning but the site was not available. The government must still be sleeping.

 

[ivinsfan]

Documentation, ugh our small business have to move from employer provided to the exchange. It's out busy season and its all family so I've been researching on the MNSure before our brokers meeting tomorrow and of course the site is messed up..

Our county is one where free bronze will be available at a certain income level but the site shows zero copay or OOP on a bronze which I know is wrong. The deduction on the Bronze is 6K not ZERO....

 

[littleb]

Ok I was able to sign up for a silver plan this morning. At the end of the 1,000 screens it stated we were eligible for subsidies for an ACA plan in 2018. The only requirement was to pay for the first month's premium which is 0.

No documents were requested at that time. Do they request documents in the next few month(s) or was that it?

 

[ShokWaveRider]

I am all done and no documents were needed.

 

[RunningBum]

If it says your application is complete, you're fine. If it says something like it is pending, then you have to wait and see. If they contact you to provide doc, it'll say something like "Verification required" or "Information required" or something like that.

I think the total time frame was something like a month for me, from application to approval.

 

[homestead]

I applied to the ACA last year and went through our health insurance broker. Never had to log on to the ACA or talk to any reps. Insurance broker asked what our 2017 income would be over the phone and they completed the ACA application for me. No docs were asked for.

 

[UnrealizedPotential]

I think they compare with what income you expect against your latest tax returns. In my case there is big difference, so they asked for documents. I sent them an explanation along with my willingness to send my 2017 income tax when it is completed.