obamacare subsidies for divorced taxpayers


R

remove ps

The Obamacare subsidy for buying health insurance applies if your
income is less than 4x the poverty level. Suppose taxpayer is divorced
and is the custodial parent of 2 kids. So does this taxpayer get the
higher poverty level. If this taxpayer gives the right to claim the
exemption to the ex-spouse, then does that taxpayer get the higher
poverty level?

Poverty levels are at
http://www.obamacarefacts.com/federal-poverty-level.php. For most
states it is:

1 = 11,490
2 = 15,510
3 = 19,530
4 = 23,550
5 = 27,570

If you have your parents living with you in your house, and they make
more than $3,500 a year because of social security income, do you still
get the higher poverty level?
 
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A

Alan

The Obamacare subsidy for buying health insurance applies if your
income is less than 4x the poverty level. Suppose taxpayer is divorced
and is the custodial parent of 2 kids. So does this taxpayer get the
higher poverty level. If this taxpayer gives the right to claim the
exemption to the ex-spouse, then does that taxpayer get the higher
poverty level?

Poverty levels are at
http://www.obamacarefacts.com/federal-poverty-level.php. For most
states it is:

1 = 11,490
2 = 15,510
3 = 19,530
4 = 23,550
5 = 27,570

If you have your parents living with you in your house, and they make
more than $3,500 a year because of social security income, do you still
get the higher poverty level?
The answers are in Sec. 36B and the final 36B regulations. Family size
for purposes of the poverty level is the taxpayer and spouse plus any
individuals for whom a dependency exemption under Sec. 151 is claimed.
There are no exceptions for those cases where a custodial parent is
releasing the exemption to a noncustodial parent. Family household
income includes the MAGI of the taxpaye and spouse and any dependent
that is required to file a tax return under Sec. 1 of the code. Sec. 1
has the standard filing requirements. Therefore a dependent who may have
to file to pay a penalty (e.g., early withdrawal penalty) and has no
Sec. 1 filing requirement does not have to add his/her income to to the
family income.
 

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