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Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.


Eligible for CC?

By on | 3 Comments

I am unemployed and my cobra coverage being paid by my employer for both my husband and I will end at dec. 2015. He is self employed and not working and I haven't been able to land a job. The only option we might have in the next year is to withdraw from my IRA. Do I qualify for coverage based on what I withdraw? What are my options?

Rose
Rosea09@yahoo.com

3 Comments

Use the actual dollars you are actually earning or estimating. There is no need to add your monthly premium assistance amount into your earned or estimated income. The credits provided to you during the year are tablulated by the Internal Revenue Service when you file your taxes. When you file, the Internal Revenue Service will check to see if the amount of income you reported to Covered California is the same as the amount of income you actually made. The IRS will also check to see if your family size is the same as when you applied. The IRS will then compare the advance premium tax credits you received during the taxable year with the premium assistance that you qualify for based on the actual household income and family size you reported on your tax return. The process is called Reconciliation.

Is the premium subsidy added as taxable income? If so, it throws income estimate way off. Thx

You will qualify for Covered California. Your husband will list himself as self-employed, and must provide as best an estimate of his monthly income as possible. If this is zero or a small amount, after his business expenses, that’s fine. You would estimate your monthly withdrawals from your IRA, and list those as income. Keep in mind that you will need to provide proof of your income within 90 days of signing up. Depending on the amount of IRA withdrawals you make each month your income will determine whether you are Medi-Cal eligible or Covered California eligible. Note that if you obtain premium assistance on a Covered California subsidy plan, and you later submit taxes that show you were qualified for Medi-Cal, Internal Revenue will require you to pay back all of the premium assistance you received throughout the year which can be costly. By keeping your IRA withdrawals each month high enough, you can properly use the Covered California plan choices.

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