Calculating MAGI

[nun]

My income on line 22 of next year's 1040 looks as if it will be close to 133% of the FPL. Can someone confirm that if I make a Traditional IRA contribution it will be deducted from the value on line 22 when calculating my MAGI.

 

[pb4uski]

Yes... assuming that you qualify for deductible IRA contributions (line 32).

See IRA Deduction Limits and http://laborcenter.berkeley.edu/pdf/2013/MAGI_summary13.pdf

 

[nun]

Yes... assuming that you qualify for deductible IRA contributions (line 32).

See IRA Deduction Limits and http://laborcenter.berkeley.edu/pdf/2013/MAGI_summary13.pdf

I've got around $5k from some self-employment income so I can put that in a TIRA and I'll be well below the 133% FPL. I wanted to make sure TIRAs counted before I went to the trouble of opening up an Individual 401k.

 

[jim584672]

The technical amount is 133%, however there is a 5% disregard making it effectively 138%. In my state they determine Medicaid based on current monthly income, not yearly income. Also once the determination is made they do not redetermine again for 12 months, so fluctuations are not considered. tIRAs can lower your MAGI.