No. of Recommendations: 20
Never too early to do your 2018 tax planning.

For 2018, you get an Obamacare tax credit up to an income of $48,240 if you're single, $64,960 if married.

If you live in one of the 20 (mostly Blue) states that are doing the "Silver Plan Switcheroo" strategy to take advantage of the Trump Innumeracy on Obamacare, you can get a Bronze Plan with a zero dollar per month premium while still realizing a fairly high income.

For 2018, I'm getting a $7500 annual tax credit on a Bronze plan with a $1.63/month premium. Modeling it on Turbo tax, I found that I can keep the full Obamacare tax credit even if I let my Modified Adjusted Gross Income rise to the full cap of $48,240/yr. If I go one dollar over that, I lose the full $7,500 tax credit.

I should probably add that in my zip code in WA State there's a $303/month difference between the monthly premium of benchmark Silver Plan that determines the size of my Obamacare subsidy and the Bronze Plan I selected. The larger that difference, the more income you can realize before you must return part or all of the tax subsidy. If you live in a RED state that's not doing the Switcheroo, you're paying more for your health insurance.

Someone living off capital gains and limiting dividend income could easily withdraw $100,000 or more from their portfolio while limiting the taxable gain to $48,240 or less. Some of the withdrawal will be a return of capital rather than a taxable gain.

Pretty sweet. Thanks Donald for making Obamacare even better for those who can do 5th grade math.
Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.