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I recently refinanced an investment property and took out some cash in the process. Is that cash taxed as income, capital gains, or something else altogether? I'm wondering if it will impact our eligibility for Obamacare support.

Cashing equity out of an investment property via refinancing is not considered income, so it should not impact your eligibility for ACA subsidies. That said, the thing about the ACA subsidies is that the income maximum is a step function. If you are just $1 over 400% of the Federal Poverty Level (FPL) for your family size, you have to pay all of the subsidies back. So you need to be pretty sure that your income level for the year will be below that amount. $1 under, and you may have to pay some of the subsidy back, but you will get to keep most of it. There are also minimum income requirements to be eligible for the subsidies, although if you have some income, even if it's not enough for the minimum, you probably can get a waiver. Here's a webpage that accurately shows the minimum and maximum incomes, by family size: https://www.healthcare.com/info/obamacare/aca-subsidy-calcul... (be aware that it is an advertising site for selling health insurance)

I would suggest that you look closely at the coverage and price of the COBRA coverage that your wife will be eligible for, and compare that to the coverage and price of ACA policies with and without subsidies, especially if you're not absolutely sure that your family's income for the year will be below 400% of the FPL. Another thing to consider is that having to change doctors in the middle of the year with a new baby because your baby's doctor doesn't take the ACA coverage could be an issue.

AJ
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