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04-15-2018 07:27 PM
100% of the FPL for 2017 ACA insurance purposes is $20,160, so the 400% FPL limit for subsidies is $80,640. You are correct.
A couple things to note:
1) This is based on your AGI.
2) If you're close to this limit or slightly over, look into your eligibility to make a tax-deductible contribution to a Trad-IRA. If you can contribute, any amount you do will reduce your AGI which could put you under the 400% FPL and make you eligible for subsidies and the cap on what you have to repay. If you're just slightly over the limit, say your AGI is $81,000, you could be looking at paying back nearly $10,000 in APTC. If instead, you contribute $1000 to a deductible Trad-IRA, your AGI will be $80,000 making you eligible for the subsidies. That $1000 invested for your retirement could save you $10,000 in tax liability!! Even if your AGI is $90,000 and you're filing MFJ. If you and your spouse can each contribute $5,000 to a deductible Trad-IRA you could reduce your AGI to $80,000 ($90,000-$10,000 in Deductible Trad-IRA contributions). In this case, it's costing you $10,000 either way, but in one case, it's still yours-- just in a retirement account. In the second case, it's the IRS's and gone forever.
Here's a link that will help you figure out if you're eligible to contribute to a deductible Trad-IRA and how much you can contribute.
If you're in the situation where you've already made a Roth IRA contribution and therefore have met your contribution limit, you should be able to recharacterize your Roth contribution (all or part) to be treated as a Trad-IRA contribution-- which would make it deductible if you meet the eligibility requirements.