Lowering Income Could Increase Your Subsidies


Your adjusted gross income affects how much of a subsidy you will receive.

TaxesYour total income minus any allowable additions or deductions equals your adjusted gross income. This number affects how much of a premium tax credit (subsidy) you will receive. If you purchase your own high-deductible health insurance plan (minimum $1250 deductible for individual or $2500 deductible for family), you are eligible to set up
an HSA (Health Savings Account). Money can be used from the HSA to pay for qualified medical and dental expenses. You can set up an HSA account at your local bank, and any contributions to the HSA are a tax deduction therefore reducing your adjusted gross income. HSA holders in 2014 can choose to contribute up to $3300 for an individual and $6550 for a family (HSA holders 55 and older get to contribute an extra $1000 which means $4300 for an individual and $7550 for a family) – and these contributions are 100% tax deductible from your gross income.

SOURCE: Craig Woodman, Demand Media http://finance.zacks.com/lower-
adjusted-grossincome-tax-returns-3698.html

 

To read the complete Spring 2014 Newsletter click here.