Thank you for the responses so far. The state in question is Texas, which uses the federal exchange. I had read on healthcare.gov to be expected to provide documentation justifying the income, and I thought I would need to have some semblance of neat and tidy monthly income to show them.
I would definitely prefer to true everything up at the end of the year rather than as I go along! I'm surprised to hear they accepted that kind of explanation from you @secondcor521
At this point in time in the ACA's life, I am convinced that the exchange will accept anything at face value from someone who appears to know what they're talking about. It took a while to get there but the kinks have been mostly ironed out.
Think about the incentives from the exchange's perspective: its entire reason for existence is to provide two things.
1) a convenient one stop shop for easy comparison and enrollment
2) preventing misuse, whether fraudulent or innocent
Item #1 is to the benefit of 3 parties: the insurers (they get customers), the enrollees (they get coverage), the government (it's the law).
Item #2 is mostly to the benefit of the government: they don't want people signing up with tax credits they're not entitled to. It's marginally also to the benefit of enrollees, who hate being surprised with a nasty corrective bill at tax time. Insurers don't care at all, they have their own problems.
The fraud problem is easily solved: not only you have to give all your personally identifiable information to the exchange, but the system is designed so that tax credit monies go directly to the insurers, not enrollees. Insurers are large, organized professional organizations who pick up the phone and generally have highly skilled professionals working for them. The average ACA enrollee has a high school education and picks up the phone sporadically.
So that really leaves one thing to focus on: accidental misuse of the website. The ACA has been on shaky ground for years, and the last thing the people in charge of it want is consumers being told X, then the IRS swoops in at tax time and says Y instead.
If that happens, people get mad. Mad people do unpredictable things, like complaining to the press, or voting mad idiots into office.
So the exchange puts guard rails in place. Lots of guard rails, arguably too many. Guard rails that try to cater to the average enrollee, who is not a sophisticated health law expert or tax wonk. But they have to also make sure that self-employed people or weirdos like early retirees with unpredictable income can sign up too. This leads to a really complex signup process.
Now a weirdo like
@secondcor521 walks in the door with an application. The application just seems fishy because
@secondcor521 is a weirdo, after all. But the weirdo application:
1) comes with a well-written, detailed explanation that shows understanding of complex matters like IRA income and tax credits
2) the weirdo's SSN, address, and a million other very personal details
If it turns out they are an unsophisticated consumer who somehow got confused, they have a papertrail showing they knew what they were doing. If it's somehow a very elaborate fraudulent enrollment, well, they can be found. The exchange concludes there is no risk here.