ACA Question

[PatrickA5]

I know there are a lot of ACA gurus that hang out here and I might have to join the ranks pretty soon if DW loses her job (which is likely).

Quick question: When applying for insurance through the federal marketplace will I have to report my income as it is currently, or do I report what I "think" it will be going forward? At this point, we wouldn't qualify for any kind of subsidy with our current income, but without her income I can probably come up with whatever MAGI I want to going forward. I assume there is a "sweet spot" to drive towards?

SIL found out today that his office is closing last quarter of this year, so my DD and family might also be looking at ACA. When it rains, it pours!

 

[jim584672]

I know there are a lot of ACA gurus that hang out here and I might have to join the ranks pretty soon if DW loses her job (which is likely).

Quick question: When applying for insurance through the federal marketplace will I have to report my income as it is currently, or do I report what I "think" it will be going forward? At this point, we wouldn't qualify for any kind of subsidy with our current income, but without her income I can probably come up with whatever MAGI I want to going forward. I assume there is a "sweet spot" to drive towards?

SIL found out today that his office is closing last quarter of this year, so my DD and family might also be looking at ACA. When it rains, it pours!

ACA subsidies are based on calendar year income so that is what you should be estimating to. Medicaid is based on current monthly income.

 

[PatrickA5]

ACA subsidies are based on calendar year income so that is what you should be estimating to. Medicaid is based on current monthly income.

So, assuming I want to start with an ACA plan on January 1, 2021, would I be using an "estimated" calendar year 2021 income to qualify or would I have to use my "actual" 2020 income?

 

[Aerides]

So, assuming I want to start with an ACA plan on January 1, 2021, would I be using an "estimated" calendar year 2021 income to qualify or would I have to use my "actual" 2020 income?

Estimated. If there is a massive difference, you might be asked to justify. But we were able to go in with the estimate which was far lower since it was our first year without W2 income.

For a couple generally the aca subsidies stop at 64.9k. ymmv.

 

[PatrickA5]

Estimated. If there is a massive difference, you might be asked to justify. But we were able to go in with the estimate which was far lower since it was our first year without W2 income.

Thanks.

If it is the first year of applying will they ask for actual income from the previous year, or are you only putting in the estimated income for the coming year?

 

[cathy63]

So, assuming I want to start with an ACA plan on January 1, 2021, would I be using an "estimated" calendar year 2021 income to qualify or would I have to use my "actual" 2020 income?

Yes, use your 2021 estimated income, but be prepared to substantiate your estimates. The marketplace will have access to your 2019 tax return (you won't have filed 2020 yet), so if you're saying your income is going to be substantially different than it was in that year, they may ask for documentation. Usually they will accept a statement made under penalty of perjury, but some states are pickier than others.

 

[scrabbler1]

So, assuming I want to start with an ACA plan on January 1, 2021, would I be using an "estimated" calendar year 2021 income to qualify or would I have to use my "actual" 2020 income?

When I reapplied for an ACA premium subsidy earlier this year, through my state's exchange (not the federal one), I sent them some income documents for 2019 but also wrote on them how I was modifying my 2019 income (including proof that I had sold at the very end of 2019 an investment which had generated a lot of income in 2019) to become an estimated 2020 income. I included some 2020 income I had already realized in January. So, my short answer to your question is, "use both of them together."

 

[Dtail]

Generically speaking, the sweet spot for maximizing the tax subsidies is to stay under 150% of the federal poverty level (FPL).
At this level, you can minimize premiums/deductibles/out of pocket maximums, if one uses a Silver Plan.
Some folks prefer bronze plans, if they have no fear of hitting the much higher OOP maximums.
Of course, depending on your state and county, the costs can vary greatly.
You can play around on the below site for different scenarios.
healthcare.gov

 

[PatrickA5]

Generically speaking, the sweet spot for maximizing the tax subsidies is to stay under 150% of the federal poverty level (FPL).
At this level, you can minimize premiums/deductibles/out of pocket maximums, if one uses a Silver Plan.
Some folks prefer bronze plans, if they have no fear of hitting the much higher OOP maximums.
Of course, depending on your state and county, the costs can vary greatly.
You can play around on the below site for different scenarios.
healthcare.gov

Thanks. I went out to the website and played around a little. Interesting to see what we qualify for based on different income levels. Will probably beat COBRA big time, but won't be as good coverage.

New question: Can I add my DS to our plan if we won't be claiming him as a dependent next year? Or, does he have to get his own insurance?

 

[Rianne]

Young Adult Coverage

Under current law, if your plan covers children, you can now add or keep your children on your health insurance policy until they turn 26 years old.
Children can join or remain on a parent's plan even if they are:

• Married
• Not living with their parents
• Attending school
• Not financially dependent on their parents
• Eligible to enroll in their employer’s plan

From https://www.hhs.gov/

 

[Rianne]

This is the best site to answer all your questions: Very easy to use.



https://www.healthcare.gov/

 

[PatrickA5]

Young Adult Coverage

Under current law, if your plan covers children, you can now add or keep your children on your health insurance policy until they turn 26 years old.
Children can join or remain on a parent's plan even if they are:

• Married
• Not living with their parents
• Attending school
• Not financially dependent on their parents
• Eligible to enroll in their employer’s plan

From https://www.hhs.gov/

Thank you. So, when the marketplace asks about how many dependents you will have, it isn't talking about Income Tax Dependents. Right?

 

[PatrickA5]

This is the best site to answer all your questions: Very easy to use.



https://www.healthcare.gov/

Thanks. That was what I was using. I just get confused when they ask for dependents.

I now remember this coming up many years ago when Obamacare first came out and we kept our daughter on my wife's insurance (through work) through age 26. The word "dependent" means something different than claiming someone as a dependent on a tax return.

 

[Rianne]

Thank you. So, when the marketplace asks about how many dependents you will have, it isn't talking about Income Tax Dependents. Right?

It is my understanding, you can add any child under the age 26 if they are not your tax dependent. My brother's daughter is married and has a full time job without insurance and she's included in his plan. She does not live in his house, nor does he claim her on his income tax returns.

"Who to include in your household"

"Include them only if you want to cover them on your Marketplace plan."


"Non dependent child under 26"


https://www.healthcare.gov/income-and-household-information/household-size/