Look Back Period For Health Subsidies
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Dennis Jarvis
May 3, 2013, 5:30:04 AM5/3/13
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Dennis Jarvis
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Article Title: Look Back Period For Health Subsidies
Author: Dennis Jarvis
Word Count: 544
Article URL: http://www.isnare.com/?aid=1836691&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=1836691
Easy Publish Tool: http://www.isnare.com/html.php?aid=1836691
*********************** ARTICLE START ***********************
We have established that health subsidies will be available to many Americans towards health insurance starting in 2014. The health subsidies are calculated based on income levels with two critical rules that drive eligibility and amount of subsidy if eligible: the 400% rule and the 9.5% rule. A person that makes less than 400% of poverty may be eligible for the subsidies but during what period of time? Let's touch base on how the Health Exchanges will view this income threshold in terms of timing.
The first income period for 2014.
For 2014 health care subsidies, the Exchange will look at your 2012 year of income (your tax filing numbers in April 2013) to establish if you are eligible or not. This is the look back period that has been described. Keep in mind that the Subsidies are based on your MAGI or Modified Adjusted Gross Income. MAGI is essentially your adjusted gross income plus interest. This means that so called "passive income" will figure into whether you qualify for a health subsidy starting in 2014. Since the MAGI is a tax term and associated with actual lines on the tax form, the Exchange will need to look at past income to establish eligibility which is true with many Government programs from Medicaid to the amount you can fund into a 401K. What happens if income changes significantly since your last tax filing?
Income goes up since health subsidy look back period
2008 was tough and many people lost their jobs or had their hours reduced significantly. Hopefully, we're starting to see the opposite trend with people finding work and adding hours. What if your income (MAGI) has gone up sizeably since the look back period and you had qualified for a health subsidy? Let's take an example. An individual makes under $25K (well below the 400% of poverty level) in 2012 as reported on his taxes in April, 2013. Based on this and assuming other qualifications are met (citizen, etc), the person would receive a health subsidy for the year of 2014. What if this same person get a big job increase in 2013 from $25K to $50K at which point he/she is no longer eligible for the subsidy? In this situation, the law requires that the recipient would pay back (at tax time) the difference between what they received as a health subsidy and what they were eligible for. There will be caps on this payback amount depending on how much the person actually did make as a percentage of the Federal Poverty Level.
What if income drops prior or during the year in question?
If your income drops significantly (let's say you lose your job or have hours cut), you may be eligible for a subsidy even though your prior year's taxes do not reflect the new drop. In this case, you can submit allowed paperwork to prove your new MAGI in order to get health subsidy advances (as opposed to credits at the time of taxes) in order to afford coverage now. The health subsidy is essentially a credit but the law establishes these advances for those that would find paying the full premium up front too expensive.
- See more at: http://www.healthsubsidy.net/Health_Subsidy_Lookback_Period.html
About The Author: Dennis Jarvis is a licensed health insurance agent who focuses on helping people understand the new health subsidy available through Reform for health care. http://www.healthsubsidy.net
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=1836691
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
Message delivered directly to members of the group:
publish-the...@googlegroups.com
*****************************************************************
Please consider this free-reprint article written by:
Dennis Jarvis
*****************************
IMPORTANT - Publication/Reprint Terms
- You have permission to publish this article electronically in free-only publications such as a website or an ezine as long as the bylines are included.
- You are not allowed to use this article for commercial purposes. The article should only be reprinted in a publicly accessible website and not in a members-only commercial site.
- You are not allowed to post/reprint this article in any sites/publications that contains or supports hate, violence, porn and warez or any indecent and illegal sites/publications.
- You are not allowed to use this article in UCE (Unsolicited Commercial Email) or SPAM. This article MUST be distributed in an opt-in email list only.
- If you distribute this article in an ezine or newsletter, we ask that you send a copy of the newsletter or ezine that contains the article to http://www.isnare.com/eta.php?aid=1836691
- If you post this article in a website/forum/blog, ALL links MUST be set to hyperlinks and we ask that you send a copy of the URL where the article is posted to http://www.isnare.com/eta.php?aid=1836691
- We request that you ask permission from the author if you want to publish this article in print.
The role of iSnare.com is only to distribute this article as part of its Article Distribution feature ( http://www.isnare.com/distribution.php ). iSnare.com does NOT own this article, please respect the author's copyright and this publication/reprint terms. If you do not agree to any of these terms, please do not reprint or publish this article.
*****************************
Article Title: Look Back Period For Health Subsidies
Author: Dennis Jarvis
Word Count: 544
Article URL: http://www.isnare.com/?aid=1836691&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=1836691
Easy Publish Tool: http://www.isnare.com/html.php?aid=1836691
*********************** ARTICLE START ***********************
We have established that health subsidies will be available to many Americans towards health insurance starting in 2014. The health subsidies are calculated based on income levels with two critical rules that drive eligibility and amount of subsidy if eligible: the 400% rule and the 9.5% rule. A person that makes less than 400% of poverty may be eligible for the subsidies but during what period of time? Let's touch base on how the Health Exchanges will view this income threshold in terms of timing.
The first income period for 2014.
For 2014 health care subsidies, the Exchange will look at your 2012 year of income (your tax filing numbers in April 2013) to establish if you are eligible or not. This is the look back period that has been described. Keep in mind that the Subsidies are based on your MAGI or Modified Adjusted Gross Income. MAGI is essentially your adjusted gross income plus interest. This means that so called "passive income" will figure into whether you qualify for a health subsidy starting in 2014. Since the MAGI is a tax term and associated with actual lines on the tax form, the Exchange will need to look at past income to establish eligibility which is true with many Government programs from Medicaid to the amount you can fund into a 401K. What happens if income changes significantly since your last tax filing?
Income goes up since health subsidy look back period
2008 was tough and many people lost their jobs or had their hours reduced significantly. Hopefully, we're starting to see the opposite trend with people finding work and adding hours. What if your income (MAGI) has gone up sizeably since the look back period and you had qualified for a health subsidy? Let's take an example. An individual makes under $25K (well below the 400% of poverty level) in 2012 as reported on his taxes in April, 2013. Based on this and assuming other qualifications are met (citizen, etc), the person would receive a health subsidy for the year of 2014. What if this same person get a big job increase in 2013 from $25K to $50K at which point he/she is no longer eligible for the subsidy? In this situation, the law requires that the recipient would pay back (at tax time) the difference between what they received as a health subsidy and what they were eligible for. There will be caps on this payback amount depending on how much the person actually did make as a percentage of the Federal Poverty Level.
What if income drops prior or during the year in question?
If your income drops significantly (let's say you lose your job or have hours cut), you may be eligible for a subsidy even though your prior year's taxes do not reflect the new drop. In this case, you can submit allowed paperwork to prove your new MAGI in order to get health subsidy advances (as opposed to credits at the time of taxes) in order to afford coverage now. The health subsidy is essentially a credit but the law establishes these advances for those that would find paying the full premium up front too expensive.
- See more at: http://www.healthsubsidy.net/Health_Subsidy_Lookback_Period.html
About The Author: Dennis Jarvis is a licensed health insurance agent who focuses on helping people understand the new health subsidy available through Reform for health care. http://www.healthsubsidy.net
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=1836691
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
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