How 401(k) Withdrawals Can Complicate Health Plan Subsidies

The IRS could be right behind you.i

The IRS could be right behind you.

Oivind Hovland/Ikon Images/Corbis


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Oivind Hovland/Ikon Images/Corbis

The IRS could be right behind you.

The IRS could be right behind you.

Oivind Hovland/Ikon Images/Corbis

There’s never a shortage of questions about the twists and turns of health coverage. Here are answers to recent questions from readers about premium tax credit repayments for marketplace plans, out-of-network emergency care and nursing home bills.

While doing my taxes I discovered that I made more money in 2015 than I anticipated. I was forced to take money out of my 401(k) to make ends meet during the year and that raised my income level. Now I face having to pay back $1,500 for premium tax credits I received to subsidize my marketplace plan’s premiums. What am I supposed to do?

It’s not uncommon for people to fail to count one-time income bumps from retirement savings or other sources when they’re estimating their annual income to qualify for advance premium tax credits for marketplace coverage, said Tara Straw, a senior policy analyst at the Center on Budget and Policy Priorities.

In the case of retirement savings, “they’re not thinking

Article source: http://www.npr.org/sections/health-shots/2016/02/09/466134182/how-401-k-withdrawals-can-complicate-health-plan-subsidies?utm_medium=RSS&utm_campaign=affordablecareact

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