If my income falls below $15,800 in 2014, how will my ACA benefits be affected?
I live in Illinois, which has expanded Medicaid for individuals with incomes under $15,800.00. I have acquired a policy under the Affordable Care Act (ACA), with an anticipated MAGI of $40,000, so I receive a subsidy. I fear I may have to take a lower-paying job later in the year, or may be out of work and find that I have fallen below the $15,800 income level when it comes time to file 2014 taxes. What happens to the subsidies and insurance and insurance benefits that I have already received during 2014 if that happens?
Madison County Illinois personal finance
Rob: Every time that people have an adjustment in their income- up or down, that affects their Affordable Care Act (ACA) health insurance tax subsidies, they are supposed to report it to the marketplace so an adjustment can be made. If this isn't done, everything gets "settled up" on their next tax return (i.e., a tax refund or a tax bill). If you want additional information, contact a "navigator" in your state. These are people who are trained to offer assistance with ACA related issues. You can find a local navigator via https://localhelp.healthcare.gov/
Thank you for your reply but with all due respect, you did not address my main question which is:
What happens to the subsidies and insurance and insurance benefits that I have already received during 2014 if that happens?
If you are unable to tell me, then I guess I will have to go hunt up a Navigator, but when searching in the past, I found that the closest ones are over 20 miles away, and I was hoping to avoid having to do that.
Rob: The income that the Affordable Care Act exchanges care about is the adjusted gross income (AGI) on your tax return – taxable income minus certain specified deductions. Let’s say you over- or underestimate that income. What you overpay or underpay will be reconciled when you file taxes in 2015. If you make more than you told the exchange, you’ll have to pay the government back for all or a portion of the subsidies you claimed, depending on whether you become ineligible for financial assistance altogether or qualified for a smaller tax break. The government will take what you owe out of your tax return, or you’ll have to cut a check. If you ended up making less and qualifying for more help, the government will cut you a check. Here is what I found via Kaiser about people whose income falls below the Medicaid qualification level as you are worried that your income might have done:Question:I estimate my 2014 income will be 140% of the federal poverty level, so I need a premium tax credit and I need to have it all paid in advance. If, by the end of the year, it turns out my annual income was even lower – 130% of the federal poverty level – so I could have enrolled in Medicaid, will I have to pay back the premium subsidy? Answer: No, your final premium credit amount will be determined based on your income for the year as reported on your tax return. The fact that it ended up being 130% of the poverty line does not mean you have to pay back the premium tax credit you received. In fact, your final credit amount will likely be larger than the amount you received in advance.Source: http://kff.org/health-reform/faq/health-reform-frequently-asked-questions/#question-whats-the-most-i...I hope this helps.