General Discussion
In reply to the discussion: How an additional $1,000 in income can cost you $6,420 more in premiums in CA [View all]muriel_volestrangler
(101,307 posts)It just talks about an 'income' of 400% of FPL.
This page does not mention health insurance premiums in the calculation of either AGI or MAGI. If you are allowed to say "we have a gross income of $67k, and gross premiums of $12,312; if I do qualify for tax credits, then I'll pay 9.5% of (67000 minus (12312 minus the tax credit)), and since 67000 minus that amount is below 62040, then I do qualify for tax credits, therefore my previous calculation is valid", then the professionals haven't picked up on it yet.
And I'm not surprised, because the above calculation is damn difficult. In general, you don't specify how to calculate something by saying "you need to know the result of this calculation to know an input for one stage of this calculation".
A calculation would go like this, even for someone who knows they will get a tax credit of some amount:
Gross income = 60000 - between 3 and 4 times the FPL of $15510
maximum net premium = 0.095 * 60000 = $5700
therefore adjusted gross income = 60000 - 5700 = 54300
but that means the maximum net premium should be calculated as 0.095 * 54300 = $5158.50
therefore adjusted gross income = 60000 - 5158.50 = 54841.50
so max net premium = 0.095 * 54841.50 = $5209.95
etc. It will converge on some value in the end, but you have to do many iterations to find it. But I don't see any instruction from the government to deduct your premiums to work out your MAGI, when your MAGI will tell you how much your premiums are.