If you are currently considering divorce, you should consider how this can boost your health insurance subsidies. According to Idea Stream, when a couple divorces each person's eligibility for insurance-related tax credits will be based on his or her own annual income. When the former spouse's income isn't counted, this causes alterations.
Normally, premium tax credits are available to people with incomes up to 400% of the 2013 federal poverty level. People are often asked to project their income for the following year on a premium tax credit application. If someone estimates that their income will be more than 10 percent lower than the previous year's data would suggest, then the system will flag this application. At tax time, the IRS will reconcile an individual or family's actual income with the amount that was projected on the application. People who received too much in credits may need to repay some of the finances.
Individuals who are separated but not divorces may encounter a different situation. For these people, chances are that each party will file taxes as being married, filing separately. Neither will be eligible for premium tax credits on the exchange as a result. If you are wondering how divorce or separation will affect health insurance subsidies and tax credits, talk with a tax attorney and a family law attorney.
Divorce naturally has tax implications. If you have the right attorney on your side, you may be able to work through these implications and anticipate the results of certain actions. This can help you to save money in the long run. Don't hesitate to call a committed and hardworking attorney to assist you in your case today! With the right Los Angeles divorce lawyer there to help, you may be able to avoid expenses with taxes!