Simple IRA + HSA=under 400% FPL sole proprietor client

Nov 28, 2017

  1. yorkriver1
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    Looks like a combo of contributions to HSA and Simple IRA would reduce household income enough to be below 400% FPL. Since the working spouse has a decent amount of self employment income, some can be deferred into the Simple IRA.
    It takes some talking to help client see that their money can be used in their favor instead of taking a calculated risk of coverage with no pre-ex for someone with some conditions that could lead to more serious issues.
    In my book a higher risk in going STM or CSM. They have to be willing to take the money they would have spent on insurance and put it away for future use.
    Others here have convinced clients to use HSA's to make tax deductible contributions to go below FPL limits. Thanks for the idea!
     
  2. kstein
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    I have one where the parents can gift an appreciated asset that is under the threshold to a child who then would pay income tax on the gains to get the child above 100% of the FPL who would otherwise have no income. Now the child gets a $0 $100 deductible plan instead of $400/mo 6000 deductible. Kinda cool helping people with these niches.
     
    kstein, Nov 29, 2017
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  3. Yagents
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  4. junkman
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    I hate just about every action and proposal that's come out of this administration. Going on 8 years and they don't have an alternative plan and are intentionally causing rates to go up while living comfortably sucking their government provided healthcare. People in the $75k to $150k range are bailing to stuff that in no way resembles insurance.
     
    junkman, Nov 30, 2017
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  5. yorkriver1
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    Going to email that to clients. I am also very carefully making sure people with employers, not self employed, answer the question about how much their employer offered benefits would cost. One prospect is now on their own, I can't write them. The employer offer in early fall was affordable.
    My tax prep friend stated about the lowering income strategy, "Remember, they will have to find ways to do that every year". Assuming that tax credits will be available, of course.
     
  6. junkman
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    The individual market is now a year to year decision based on ridiculously changing set of rules and prices. Many in the $100,000 range are bailing to non-insurance products as even the highest OOP plans are more than they are willing to pay.
     
    junkman, Dec 4, 2017
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  7. scagnt83
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    Your solution only works for people who are able to live on 400% FPL. I guess you could just go into debt and put everything on credit cards.... transfer balances to a new 0% card every year... pray that single payor comes sooner vs. later. That or spend $12k - $24k a year on insurance premiums that dont pay for jack sh*t until you pay another $12k in deductibles.
     
  8. Yagents
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    Yagents, Dec 5, 2017
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  9. scagnt83
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    scagnt83 Worldwide Expert of Everything

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    I have a client who is a solo business owner. He received $20k in checks over the past 2 months and is waiting until 2018 to cash all of them. That, combined with 401k/HSA/other deductions will put him just below 400%fpl.

    ----

    I've met green card holders that are leaving the US because they can't afford health insurance premiums. They love living in the US but cant afford an extra $30k a year for it. (these are white collar professionals for those who are wondering)
     
    Last edited: Dec 5, 2017
  10. junkman
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    Yes, divorce is being considered by several people I know. Also, self employed can shift money to 1 former spouse with 1099s or even getting an EIN and paying the former spouse wages.

    Eight years and no plan. Put all members of Congress on ACA paying the full unsubsidised premium and this would all be straightened out.
     
    junkman, Dec 7, 2017
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