Question: My Husband took out 20,000 from his IRA, I believe it raised our income to 47000 which normally be around 27,600 with half of his SS and my rental income. I did not report this chanage as I am confused on what is Income, if we do not count on that money yearly nor will we have it ever again, how do I calculate or preview plans that are based solely on our 'Income' and not extras, as not to over pay.
Answer: Yes.Based on what you've told me, your taxable income for 2014, will be about $47,000. Since you are collecting a monthly subsidy based on an estimated income of $27,000, your excess subsidy will be about $1,700 for 2014. What that means to you is, your tax bill for 2014 will increase by $1,700. I suggest save up the $1,700 to pay the additional taxes in April, but do not change your income with Covered California. That's because in 2015, your income will return to to about $27,000 and you'll be back on track will a minimum of complications.