Can I Sell an ETF at a Loss to Lower My MAGI for an ACA Premium Tax Credit?

[Mo Money]

Short question which, since it's ACA-related, is probably hard to answer:

If I sell an ETF at a loss in 2019, will this lower my MAGI for ACA purposes?

I am going to be right at the edge of the premium tax credit cliff. So I'm trying to figure out a way to back off of the cliff edge enough to get a ~$3K premium tax credit. The easiest way I can see is to sell an ETF at a loss, wait long enough to evade the wash-sale rule (maybe 35 days?) and buy back the same or a similar ETF at that time.

Thoughts, oh ACA/Tax Gods?

 

[Smitty700]

Capital losses lower your MAGI for ACA purposes. But the key thing to keep in mind is that capital losses can only be taken up to the amount of your capital gains or $3000, whichever is larger.

So if you have no capital gains for the year, you can get up to a $3000 capital loss taken off your AGI. The loss above $3000 will rollover to next year.

 

[ivinsfan]

Mo another option would be since you are going over, go over enough to fund some of next year's living expenses. This would hopefully lead to a bigger credit for 2020.

 

[pb4uski]

....If I sell an ETF at a loss in 2019, will this lower my MAGI for ACA purposes? ...

Capital losses lower your MAGI for ACA purposes. But the key thing to keep in mind is that capital losses can only be taken up to the amount of your capital gains or $3000, whichever is larger.

So if you have no capital gains for the year, you can get up to a $3000 capital loss taken off your AGI. The loss above $3000 will rollover to next year.

Agree... as long as the subject ETF is in a taxable account... if the ETF is in a tIRA or Roth then it will not help the OP's ACA situation.