Q: What is the definition of a “modified adjusted gross income”? Can a person project modified adjusted income for 2014 in an application for Obamacare rather than using 2013 income? How will long-term health insurance and other health care deductions be applied in figuring income? Will charitable contributions be useful for deductions? Thank you.
A: Like you, I wasn’t very familiar with the term before the federal government announced that “modified adjust gross income” or MAGI would be a key part of any application people make to the Healthcare Marketplace, or online exchange.
This number is what those eligible to shop for this insurance — the unemployed and those who buy individual plans — will use to determine if they qualify for any financial help on their monthly premiums. The application requires that you estimate your 2014 MAGI from previous paychecks and other sources of income.
Here’s the official spiel from www.healthcare.gov: “Modified adjusted gross income is generally your household’s adjusted gross income plus any tax-exempt Social Security, interest, and foreign income you have. It’s used to determine your eligibility for lower costs on Marketplace coverage, and for Medicaid and the Children’s Health Insurance Program (CHIP).”
The application process won’t be live for a few more days, but all signs point to your needing to submit as much previous information as possible. (See https://www.healthcare.gov/will-i-qualify-to-save-on-monthly-premiums/)
You don’t have to do the math on your own. In Florida, the federal online marketplace is handling the applications, and it will do the calculations based on information you submit.