Finally FI
Dryer sheet aficionado
- Joined
- Nov 12, 2022
- Messages
- 39
I retired last year. DW is currently employed, and we have health insurance through her employer.
Our current plan is for her to retire at the end of this year. That would mean 12 years of ACA before we're both on Medicare.
Most of our portfolio is pre-tax, and i-ORP shows issues with us staying under our desired AGI for ACA subsidies.
So, I'm planning to do a big Roth conversion this year to address that, but want to make sure I'm understanding everything correctly before pulling the trigger.
Please let me know if these are correct or if I'm misunderstanding something:
Our current plan is for her to retire at the end of this year. That would mean 12 years of ACA before we're both on Medicare.
Most of our portfolio is pre-tax, and i-ORP shows issues with us staying under our desired AGI for ACA subsidies.
So, I'm planning to do a big Roth conversion this year to address that, but want to make sure I'm understanding everything correctly before pulling the trigger.
Please let me know if these are correct or if I'm misunderstanding something:
- ACA subsidies are based only on the AGI of the year ACA is used. AGI's of prior years are not taken into consideration, no matter how large.
- Roth contributions and Roth conversions are completely separate. We can contribute $7500 each this year, and I can do a Roth conversion for as much as I'd like.
- For 2023, $117,150 keeps us in the 12% tax bracket ($89,450 bracket max plus $27,700 MFJ standard deduction). That would be the total of her income (less pretax items like employer health insurance, 401k & HSA contributions, etc.) plus interest & dividends plus the Roth conversion.