Messages

1

Taxes / Re: Withdrawal plan for IRA to reduce impact upon death of spouse

« on: February 03, 2023, 12:07:48 PM »

Market moves one way or the other does not affect or interest
us in any way as we have just Cash accounts with brokerage
and the $2,500 is just simple interest (no bonds, no stocks)
Should interest rates goback down to zero, no issues with that.

For 2023 (to be filed in 2024), the 12% top is $89,450
Taxed as $2,200 plus 12% of the amount over $22,000
 89,450-22,000 = 67,450 * 0.12 = $10,294 tax owed

Ok to make one IRS 1040ES payment 12/2023 via EFTPS
or should it be made in quarterly payments or even early 2024?

In case it matters, have not made any IRS tax payments for
over a decade due to too small of income and kept it
that way deliberately to get maximum ACA subsidy before
moving over to Medicare.

2

Taxes / Withdrawal plan for IRA to reduce impact upon death of spouse

« on: January 28, 2023, 06:03:50 AM »

Background and some easy numbers for hopefully easy math.

Quick facts:
MFJ, both 65+, both on Medicare A+B (nothing else), both have NOT filed for Social Security, no income except IRA interest.

Living expenses paid from a 1M traditional IRA which currently generates about $2,500 in interest income each month.
Projected income for 2023 about $34k which is more than is needed
Medicare premiums are paid from an HSA account with about $45k balance
No debt.

Trying to come up with a plan for easy withdrawal between now and age 70 when both (if alive) will file for Social Security, have a few more years to go. Understand that RMD's don't start until about 72/73.

Trying also to come up with a plan, should one of us die before 70 and the burden or inherited IRA occurs in combination of also possibly being close to 70 and having now full benefit of the larger earning spouse Social Security (about 4,500/month).

Have discussed using QCD's to ease the tax burden for the surviving spouse.

Any suggestions or online calculators or spreadsheets to model these variables?

3

Taxes / How is a serious underestimate of MAGI for ACA handled ?

« on: August 19, 2019, 03:51:57 PM »

We seriously overestimated our ability to generate income for tax year 2019 when applying for ACA in November last year. As a result, we will be several thousand dollars below 100 percent Federal Poverty Level when doing our taxes next year.

There is no penalty for being under the estimated MAGI and Florida does not enforce Medicaid/Medicare for families below 100% poverty level.

In fact, had we known what we now know about our income for 2019, we would not even have qualified for Blue Cross Silver plan or any plan at our projected total income.

As I now see it, likely there will be no problem come November 2019 to enroll for ACA for 2020 and we should have enough income in 2020 just in case evidence to support MAGI next year is requested.

But what about 2019 -- how and what may occur with a seriously low income this year and the subsidy we have received based on overestimating our MAGI ?