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Old 09-28-2017, 11:15 AM
 
1,066 posts, read 518,049 times
Reputation: 1824

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Quote:
Originally Posted by CatPeople View Post
Thank you all for your input. This is fun. Let me clarify. Simulation numbers, 400K taxable in 5% dividend stocks, 20K taxable income. 600K in IRAs generating 30K tax-deferred.

Cash out 100K in dividend-paying stocks in 2017. Pay maybe 10K in cap gains, $90K in the bank.

2018, live off the $90K and getting a $9,000 ACA subsidy because my taxable is now under 20.

Lose $5K in dividends and get a $9K tax subsidy.

61 play this game for 4 years, then get for Medicare for $150 a month.
Are those IRAs Roths? Because you are going to want to start converting over to roths if you can, but that is going effect the income. Personally, I'm betting that that ACA won't be around long, so I'm taking advantage of the subsidies at the expense of conversions, but I've only got about 300k left in the traditional ira, and I'm 15 years from RMDs, so I've got more time on my side.
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Old 09-28-2017, 11:47 AM
 
7,928 posts, read 5,045,305 times
Reputation: 13582
Quote:
Originally Posted by lieqiang View Post
It's easy! Say you are a couple that retired early and have 2 million bucks, half in taxable and half in tax deferred. You own your home and your expenses are $60k annually. To fund your expenses you have $25k of dividends from taxable investments and sell $35k which from your basis generates $25k of capital gains.

Congrats! Your income (as far as ACA sees it) is $50k, which in Arizona for a married couple filing jointly means $1,013/month in subsidies for a Silver Plan.
In my state, for a single person, the ACA subsidy phases out completely at an income level of $47,520. Taking zero withdrawals from my accounts, and making zero trades, and doing nothing besides breathing and meditating in lotus-position, I canít see how to reduce my dividends and interest below $47,520/year. I use tax-free bonds to reduce federal income tax, but tax-free bond interest counts under MAGI for ACA purposes.

Even if somehow my MAGI could be dropped to $25K/year, the ACA subsidy is a whopping $138/month, whereas my monthly premiums under the most horrendous highest-deductible Bronze plan would exceed $300/month.
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Old 10-26-2017, 07:05 PM
 
Location: Pueblo area
212 posts, read 121,976 times
Reputation: 483
2018 numbers are out. At 20K taxable dividends and cap gains, tax credit is now $913 a month making the $0 deductible $2,350 max out of pocket $109. Amazing. For a whopping $62 a month there is $1K deductible, but the max out of pocket is only 1,600. My COBRA is 400 and doesn’t pay a penny until you spend 6,000. Sell stocks paying $5K after-tax and get $11K in tax credits. I’m in, who knows how long this will last. I am healthy, spend almost nothing at doctors, but insurance is there for a reason.

If you can keep your taxable under $16K, you get “free” Medicaid, even with a million in rollover IRAs.

Meanwhile the truck driver who makes 50 gets to pay $1,000 a month.

Not sure about other states but at Connect for Health Colorado - Colorado's Health Insurance Marketplace there are 2018 links at the top to play around with.
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Old 10-27-2017, 07:55 AM
 
Location: On the road
5,954 posts, read 2,897,780 times
Reputation: 11397
Quote:
Originally Posted by ohio_peasant View Post
Taking zero withdrawals from my accounts, and making zero trades, and doing nothing besides breathing and meditating in lotus-position, I canít see how to reduce my dividends and interest below $47,520/year.
You probably have a lot more savings in taxable accounts than most of these evil early retirees who are using ACA subsidies.
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Old 10-27-2017, 07:59 AM
 
Location: On the road
5,954 posts, read 2,897,780 times
Reputation: 11397
Quote:
Originally Posted by CatPeople View Post
Iím in, who knows how long this will last. I am healthy, spend almost nothing at doctors, but insurance is there for a reason.
Yep, we carry ACA insurance and don't even live in USA. If we need to evac back to USA for medical reasons we don't want to land and not have insurance to cover whatever drastic situation caused said medical evac.

It's cheap enough that it's worth it, even though the chances of us using it are tiny.
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Old 10-27-2017, 03:02 PM
 
11,134 posts, read 8,548,081 times
Reputation: 28124
I hope those intentionally planning on using Medicaid for their long term care aren't judging those using the ACA.
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Old 10-27-2017, 03:04 PM
 
71,638 posts, read 71,777,271 times
Reputation: 49230
they shouldn't be. both have their requirements and rules and if you qualify legally you qualify.

it would be very easy to stop all these laws and tools from being used that are used by those with assets but there are reasons they are purposely left in place .
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Old 10-27-2017, 03:12 PM
 
11,134 posts, read 8,548,081 times
Reputation: 28124
Quote:
Originally Posted by mathjak107 View Post
they shouldn't be. both have their requirements and rules and if you qualify legally you qualify.

it would be very easy to stop all these laws and tools from being used that are used by those with assets but there are reasons they are purposely left in place .
Funny how those with money complain about poor people being moochers. People hate government benefits until they want to use them themselves.
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Old 10-27-2017, 03:19 PM
 
71,638 posts, read 71,777,271 times
Reputation: 49230
committing fraud if that is the case to get welfare perks is bad and they should be caught and prosecuted and many do abuse the welfare perks fraudulently .

there is a difference between legally getting something you qualify for and committing lies and fraud to get it .

if you qualify fair and square -great
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Old 10-27-2017, 05:52 PM
 
1,577 posts, read 582,546 times
Reputation: 3363
One thing to remember in this discussion is that there are several plans available through the ACA. Anyone who is using one of the Platinum plans, which offer more generous coverage [good for people with health issues] get ZERO in subsidies. It is not eligible for the subsidies. Just because someone is using an ACA plan does not mean they are using the Silver plan. And some people are above the income limits for subsidies!

We are not using the ACA but we looked into it very closely.
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