ACA for self employed ?

Discussion in 'Off-topic' started by xls177, Nov 2, 2018.

  1. xls177

    xls177 Member

    What is the best choice for health insurance for the self employed?
    Looks like my only choices because of cost would be short term medical or ACA coverage plan.

    If i make more money then i think i will.
    Can i stop ACA coverage and not be charged the un subsidized rate or will i be pay more at the end of the year tax filing?
  2. GoDores

    GoDores Like a Boss

    The subsidy is based on your previous year’s earnings. If you make more next year than this year, whatever subsidy you received above the amount your higher income qualifies for will be added to your tax liability at the end of the year. You can increase your quarterly withholding to compensate if you start earning more than planned.

  3. Malum Prohibitum

    Malum Prohibitum Moderator Staff Member

    Welcome to the club. The most expensive Gold plan (which is actually not as good as the pre-ACA coverage I had while self employed for $450 monthly) would cost me almost $48,000 in 2019 without any premium subsidy.

    Now you know why they had to put subsidies in there to get this passed.

    You could be in for a nasty surprise at the end of the year.

    Planning helps.

    Knowing where you are before the end of the year, and then you have until April 15 of the following year to squirrel away money in tax advantaged accounts or other things to get your MAGI down.

    Also, there are caps on the amount of the subsidy you would be forced to repay should your income be higher than expected. Going from memory, it was $2550 for 2017 if your income did not go above 400% of the poverty level for your family size. If it goes over that, hold on to your wallet. No cap.
  4. Malum Prohibitum

    Malum Prohibitum Moderator Staff Member

    In 2015, 62 percent of people who received advance payments had to repay excess premium tax credits.[3] This is expected, since the premium tax credit is very sensitive to changes in income. However, the repayment amounts for 72 percent of people who received an overpayment fell under the caps, meaning they had to pay back the full amount. Only 28 percent of marketplace enrollees who owed money back — or 17 percent of all taxpayers who claimed premium tax credits — had those repayments limited by the cap. In total, the IRS estimates that in 2015, the cap reduced repayments of premium tax credits by only $874 million, or 4.6 percent of the total premium tax credits claimed.​

    Also, there is a helpful chart in that article. It is for 2017, but it should not be too far off for 2019.
  5. moe mensale

    moe mensale Well-Known Member

    This ACA debacle almost smells like a ponzi scheme. Nah, it couldn't be. I mean, everyone read the bill before passing it, right? Right?