Subsidy Eligibility Debate

[somarco]

Found myself in the middle of a subsidy question on a public forum. I think I am right but willing to admit defeat.

Man and woman living together. Not married. Man gets job with health insurance. Live in is eligible for health insurance since they are engaged.

To add her jumps his premium by $400/mo.

Someone suggested she apply via the exchange. As long as they file taxes separately she can qualify for a subsidy based on her income alone.

I don't think so. My understanding is, if she is ELIGIBLE for coverage she is not entitled to a subsidy, even if she refuses the coverage.

Which is it?

 

[hamben]

if they live together then you can not just use her income for household income. she might qualify for exchange but can not use just her income.

just my opinion....io also think you are correct. the law says access to employer based insurance. that's why I think all employers should stop offering the crap..

 

[kgmom219]

Both answers are right.

"Engaged" is not a legal term. Depending on the state, there are 4 types. Single, Married, Legally Separated and Divorced.

If the group plan (and state law) allows "engaged" people (that's really a dumb way to do it) to be on the employer plan, she is not subsidy eligible.

HOWEVER, she is not legally married and I assume they do not file taxes together. Therefore, under the IRS rules, she is single and subsidy eligible. The IRS only recognizes single and married. (And in some states, that includes same sex marriage)

(I don't even think they can say "engaged" makes you group eligible. Domestic partner, sure. But not engaged. What state is this in?)

 

[somarco]

Georgia, which recognizes common law as long as it is not same sex. I almost used betrothed instead of engaged but figured that might raise some eyebrows.

GA also recognizes domestic partnerships as long as opposite sex.

 

[RayNY]

Does the group allow any employee to say anyone off the street is their live-in soon to be wife and enroll them on the company healthplan, without proof?

If so, she is eligible for employer sponsored coverage, and therefore, not subsidy eligible. I'll eat an entire broccoli if this is the case-I've never even heard of any company letting any employee enroll anyone they want without proof.

If not (proof of DP status is required) than she is NOT explicitly eligible, and therefore IS subsidy eligible. Nowhere in any law does it compel anyone to prove DP status.

Further, since they are unmarried, they could not file a joint tax return. Any subsidy calculation would only take into account her income/deductions and a household size of 1 (unless she has a dependent).

I'm confident to say, she is subsidy eligible. She loses eligibility when they get married.

 

[jefflange]

Does the group allow any employee to say anyone off the street is their live-in soon to be wife and enroll them on the company healthplan, without proof?

If so, she is eligible for employer sponsored coverage, and therefore, not subsidy eligible. I'll eat an entire broccoli if this is the case-I've never even heard of any company letting any employee enroll anyone they want without proof.

If not (proof of DP status is required) than she is NOT explicitly eligible, and therefore IS subsidy eligible. Nowhere in any law does it compel anyone to prove DP status.

Further, since they are unmarried, they could not file a joint tax return. Any subsidy calculation would only take into account her income/deductions and a household size of 1 (unless she has a dependent).

I'm confident to say, she is subsidy eligible. She loses eligibility when they get married.

I agree with what RayNY ^^^ said

 

[Ann H]

Normally, Somarco, I would have said she is NOT eligible for subsidies because she IS eligible for a group plan that is affordable/adequate.

However.... I just found myself corrected recently on one of these cases when it involved a child under the age of 26. In that case, the child was ELIGIBLE for his parent's employer-based policy, but the kid and his parent's weren't talking to each other, and the parents would not insure him. The kid filed his own tax return. Yagents found a reference on hc.gov where it said that the adult kid who filed his own tax return was eligible for a subsidy despite the fact that this "under age 26" kid was also eligible for his parents' employer-based plan.

Your case is somewhat similar. It's an adult, who is technically eligible for an employer-sponsored group plan, but files their own tax return legitimately. Although I normally would have said, "No subsidy if ELIGIBLE FOR any employer sponsored group plan that is affordable/adequate", now I have to hold my breath and see if Yagents trumps me again!!

 

[somarco]

I bow to the queen.

Now that you mention it, I seem to recall that thread where Yagents quoted some obscure section of the law making the kid (in your case) eligible.

And this is similar, but different. People live together for years without benefit of marriage or other formal relationship until someone decides they want more. I don't know all the particulars in this case. How long they have been engaged, how long they have lived together, how long they will live together, etc.

Can't say if it is enough to make her eligible or not.

The OP in that thread is the one that asked HR about covering her, they said yes, and here is the premium.

He choked and then wanted something cheaper, preferably with a subsidy.

My take was, since HR said she was eligible, no subsidy. But I have been wrong before.

I think.

 

[kgmom219]

Ray go eat some broccoli. (Or buy me a margarita).

Texas doesn't require proof.

However, putting an opposite sex partner on your enrollment form CAN be used in court to prove marriage, so she can get half your stuff.

 

[somarco]

putting an opposite sex partner on your enrollment form CAN be used in court to prove marriage, so she can get half your stuff.

There's a country song in there somewhere.

Back in my day ............ it was understood they were the opposite sex.

Not that there is anything wrong with that of course.