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Level 1
posted Jan 26, 2020 12:01:25 PM

Roth Distribution and Cover CA

I'm curious to know if my wife and I take a Roth Distribution (withdrawal) will this be counted as income in the eyes of Covered CA and lower our premium assistance we receive? A couple of facts regarding us:

  • We're both over 59 ½ and we both have had our Roth IRA's for more than 5 years.

I believe if we meet the two criteria above we aren't subject to tax on a distribution but I just want to ensure the rules regarding Covered CA and the "countable sources of income".

Thank You!

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1 Replies
Expert Alumni
Jan 27, 2020 3:32:57 PM

Non-taxable IRA distributions (like Roth distributions) are not "countable sources of income".  

 

On the above link, if you look at line 15b, only taxable portions of your IRAs are added to MAGI. This makes a certain amount of sense, you already earned most of this money and paid taxes on it.

 

More information about income and ACA is here.