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12-30-2013, 03:59 PM
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#1
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Recycles dryer sheets
Join Date: Nov 2006
Posts: 428
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Slow to realize....
I've spent some time figuring out what are the key breakpoints for ACA subsidies and when to take SS (with an eye towards minimizing taxes by reducing work hours and IRA distributions) when I realized that I can give away as much as is needed to get at the efficient tax level. This feels much better than trying to minimize income. Silly, but so much easier, especially if there is paid work you enjoy. If you give, I recommend research via the Charity Navigator site.
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12-30-2013, 06:04 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,007
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Quote:
Originally Posted by Tekward
I've spent some time figuring out what are the key breakpoints for ACA subsidies and when to take SS (with an eye towards minimizing taxes by reducing work hours and IRA distributions) when I realized that I can give away as much as is needed to get at the efficient tax level. This feels much better than trying to minimize income. Silly, but so much easier, especially if there is paid work you enjoy. If you give, I recommend research via the Charity Navigator site.
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I don't think it works that way. Charitable deductions are AFTER AGI. Yes, it will lower your taxes, but it won't lower your income for the purpose of ACA subsidies.
IRA contributions, HSA contributions, and a few other things lower your AGI, but itemized deductions on Schedule A do not.
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Retired since summer 1999.
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12-30-2013, 09:16 PM
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#3
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Thinks s/he gets paid by the post
Join Date: Jul 2009
Posts: 1,934
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Quote:
Originally Posted by audreyh1
I don't think it works that way. Charitable deductions are AFTER AGI.
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Correct. Charitable contributions, like all other itemized deductions, don't affect your income for ACA/subsidy purposes.
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And if I claim to be a wise man, it surely means that I don't know.
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12-30-2013, 09:46 PM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,264
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+2
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If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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12-31-2013, 05:46 AM
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#5
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Recycles dryer sheets
Join Date: Nov 2006
Posts: 428
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Thank you. I obviously need to spend more time on the details. Appreciate the help.
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12-31-2013, 05:54 AM
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#6
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Thinks s/he gets paid by the post
Join Date: Oct 2012
Location: Colorado Mountains
Posts: 3,165
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I believe the exception is direct transfer of RMDs to a charity if you are over 70.5. At least for 2013.
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12-31-2013, 06:31 AM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,007
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Quote:
Originally Posted by Hermit
I believe the exception is direct transfer of RMDs to a charity if you are over 70.5. At least for 2013.
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Sure - because that is never recognized as income.
Same with gifting appreciated securities to charity - it is never recognized as income, so it doesn't show up in your AGI.
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Retired since summer 1999.
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01-01-2014, 02:25 PM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2004
Location: SW Ohio
Posts: 14,404
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Quote:
Originally Posted by audreyh1
Sure - because that is never recognized as income.
Same with gifting appreciated securities to charity - it is never recognized as income, so it doesn't show up in your AGI.
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I thought that gifting appreciated assets was an itemized deduction from income--taken after computation of AGI and only good if not taking the standard deduction. Is it possible to gift appreciated securities and instead not count it as income for computation of AGI?
I remember it was possible to do this with IRA transfers to charities, but I thought that ended 31 Dec 2013 (I'd like to find out it was extended to 2014, would be good news for my MIL).
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01-01-2014, 04:24 PM
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#9
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Thinks s/he gets paid by the post
Join Date: Oct 2012
Location: Colorado Mountains
Posts: 3,165
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Quote:
Originally Posted by samclem
I thought that gifting appreciated assets was an itemized deduction from income--taken after computation of AGI and only good if not taking the standard deduction. Is it possible to gift appreciated securities and instead not count it as income for computation of AGI?
I remember it was possible to do this with IRA transfers to charities, but I thought that ended 31 Dec 2013 (I'd like to find out it was extended to 2014, would be good news for my MIL).
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I think you are correct. It is possible Congress will reinstate it for 2014. That's what they did in January 2013 for the 2013 year.
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01-02-2014, 02:54 PM
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#10
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Recycles dryer sheets
Join Date: Mar 2013
Location: Scarsdale
Posts: 180
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I do not think this would work as charities does not affect MAGI. I did come up with an idea on how to deal with the obamacare subsidy cliff.
http://www.early-retirement.org/foru...ent-68822.html
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"There are no solutions...there are only trade-offs." - Thomas Sowell
Looking to retire or semi-retire by 45 based on our net worth going to $6 million outside our house.
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