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View Diary: ACA Advice Needed- Falling through the cracks? (42 comments)

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  •  the subsidy IS your tax credit, advanced to you (4+ / 0-)
    Recommended by:
    lgmcp, bmcphail, dragonlady, CoyoteMarti

    in the form of a premium contribution-payment directly to the insurance co, and I agree, what a mess for folks with unpredictable incomes.

    As I understand it, the subsidy is simply an advance of your Tax Credit, they are one and the same thing. You can opt to spend it now, on purchasing insurance thru the marketplace, rather than later as a Tax Refund.

    I went into a lot of detail on this with the Call Center person: What if I guess (predict) wrong?? And you are right, it comes out in the wash, so to speak, on your 2014 Return that you do in April 2015. If you overspent your actual Tax Credit (assessed based on your actual income, past tense, and verified with 1099s or whatever other forms as usual) then you will OWE that difference, the amount of money you already spent buying insurance premiums, to the IRS.   I guess in essence its a loan rather than an advance, heh, but only if you guess/predict wrong in the wrong direction. Oy.

    Also.... they stressed that you should contact them and report a Change In Circumstance during the year if need, so as to avoid getting bit in the ass like that, anytime you have a change, increase or decrease, to report. They will adjust the subsidy amount right then and there, thereby avoiding a big hit in 2015. It does NOT affect what Plan you have, thats a lock and you cant change that until next Open Enrollment, next year.

    If I can't dance I don't want to be part of your revolution. ~ Emma Goldman

    by Lady Libertine on Mon Mar 31, 2014 at 08:09:45 AM PDT

    [ Parent ]

    •  I was under the impression that (0+ / 0-)

      if your income was on the low end of the scale, that the penalty was limited to a low number as well, regardless of the outlay on premiums.  Did your call center person get into that?

      We are the principled ones, remember? We don't get to use the black hats' tricks even when it would benefit us. Political Compass: -6.88, -6.41

      by bmcphail on Mon Mar 31, 2014 at 10:29:17 AM PDT

      [ Parent ]

      •  From US News: (1+ / 0-)
        Recommended by:
        CoyoteMarti
        If your income is less than 200 percent of the FPL, the maximum repayment is $600 for families and $300 for individuals.

        We are the principled ones, remember? We don't get to use the black hats' tricks even when it would benefit us. Political Compass: -6.88, -6.41

        by bmcphail on Mon Mar 31, 2014 at 10:35:05 AM PDT

        [ Parent ]

        •  my head is still spinning (0+ / 0-)

          from all this. You only get dinged with the "penalty" for not having insurance at all. That penalty is a percentage calc of whatever your AGI comes out to when you file next year (& kids are half-price)... as I understand it. I have no idea how theyre planning to manage all that.

          But you're saying something different I think. Have you got a link to that?

          If I can't dance I don't want to be part of your revolution. ~ Emma Goldman

          by Lady Libertine on Mon Mar 31, 2014 at 12:12:22 PM PDT

          [ Parent ]

          •  What happens if my income changes? (1+ / 0-)
            Recommended by:
            Lady Libertine

            What happens if my income changes?

            Do I have to pay back subsidies?

            Most consumers receiving premium subsidies will receive it in the form of an advanced tax credit, with the subsidy applied directly to the cost of their insurance. Since these amounts will be based upon your projected income for the year, the actual amount of subsidies you are eligible will in many cases differ. If you end qualifying for more subsidies than any amount will be received in the form of a tax credit when income taxes are filed. What happens if you actually make more money and therefore qualify for less subsidies than you received?

            In cases where households received higher amounts than they were ultimately eligible for, they are responsible for repayment of some or all of the tax credits they received. How much they have to pay back will depend upon their final household income. Households with a final income over 400% of FPL will be required to pay back the entire premium subsidy amnount. For those households with incomesunder 400% of FPL, repayments will be capped at the following amounts
            Income Range     Repayment Cap
            < 200% FPL     $600 ($300 individual)
            200% to 300% FPL     $1,500 ($750 individual)
            300% to 400% FPL     $2,500 ($1,250 individual)
            - See more at: http://www.valuepenguin.com/...

            We are the principled ones, remember? We don't get to use the black hats' tricks even when it would benefit us. Political Compass: -6.88, -6.41

            by bmcphail on Mon Mar 31, 2014 at 01:10:57 PM PDT

            [ Parent ]

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