Calculator for balancing 0% capital gains harvesting with ACA Subsidies?

[SugarMountain]

Does anyone have a calculator for modeling capturing capital gains with 0% taxes vs ACA subsidies?  Right now we've retired and will have about $40k in income from dividends and interest and I would like to start capturing some capital gains, basically up to about $60k seems possible to stay under $78k and have 0% capital gains tax. (My understanding is the cutoff is post deductions, so $$78k+26k-$40k=$64k).  However, we are also getting ACA subsidies and if we have an income of $104k we'll have priced ourselves out of the subsidies.  I suspect there is a sweet spot of income to maximize the future tax savings and ACA subsidies.  Before I try to throw everything into a spreadsheet, I thought I'd ask if this has already been solved somewhere.

[MDM]

If you are looking at the choice for a single year (e.g., 2021), the case study spreadsheet will do that.

[seattlecyclone]

Have you looked at my graph of the marginal rates that result from ACA phase-outs?

For a childless couple your $40k base level is about 230% of the poverty level. At that point, for every dollar of additional income you'll be paying about 12¢ in increased insurance premiums. The marginal rate rises from there though. Between there and 400% of the poverty level the rate averages out around 15%, but sometimes spikes as high as 18%. After 400% of the poverty level (approximately $69k total MAGI for a two-person household) the marginal rate drops to 8.5% until the subsidy dries up entirely, and then you're back to only worrying about the standard tax brackets.

Based on this I'd say the two real options are to either realize zero unnecessary income to keep your premiums as low as possible, or go all the way up to $104k. The marginal rates are highest in the $40-69k range. If you're going to realize any extra income in this range you'll do well to blast past there into the zone where your tax rate actually goes down.

This is an exception to the general rule that you pay less tax in the long term by keeping your income as even as possible from year to year. In your case you'll pay less if you switch off between years of $40k and $104k than if you split the difference and realize $72k of income each year.

[SugarMountain]

Thanks guys, very helpful!

[Morning Glory]

Following. @seattlecyclone 's graph was very helpful but I'm looking for more resources on choosing a plan.

 I'm hoping to pull the plug in six months.  I played with calculators for a couple of possible fire destinations that don't have expanded Medicaid.  With my projected spend I can get my premium and deductible down to $0 after subsidies with a silver epo for the adults and chips for the kids. My biggest fear is getting sick while traveling and having to go out of network. (I know emergency care is covered but it's shocking what isn't considered an emergency). The ppo plans don't look much better than the epos because the oop max seems to only apply in network, and they have a higher deductible. Any suggestions there?

[seattlecyclone]

Following. @seattlecyclone 's graph was very helpful but I'm looking for more resources on choosing a plan.

 I'm hoping to pull the plug in six months.  I played with calculators for a couple of possible fire destinations that don't have expanded Medicaid.  With my projected spend I can get my premium and deductible down to $0 after subsidies with a silver epo for the adults and chips for the kids. My biggest fear is getting sick while traveling and having to go out of network. (I know emergency care is covered but it's shocking what isn't considered an emergency). The ppo plans don't look much better than the epos because the oop max seems to only apply in network, and they have a higher deductible. Any suggestions there?

That's something that will depend very much on what plans are available in your area. To some extent you might expect that something not rising to the level of an emergency (like an urgent care visit) would be something that could be reasonably paid out of savings if necessary, but I'm not sure how much that expectation holds true in practice. I know where I live there's only one insurer that offers out-of-network urgent care benefits, but every place is different.

[Morning Glory]

Following. @seattlecyclone 's graph was very helpful but I'm looking for more resources on choosing a plan.

 I'm hoping to pull the plug in six months.  I played with calculators for a couple of possible fire destinations that don't have expanded Medicaid.  With my projected spend I can get my premium and deductible down to $0 after subsidies with a silver epo for the adults and chips for the kids. My biggest fear is getting sick while traveling and having to go out of network. (I know emergency care is covered but it's shocking what isn't considered an emergency). The ppo plans don't look much better than the epos because the oop max seems to only apply in network, and they have a higher deductible. Any suggestions there?

That's something that will depend very much on what plans are available in your area. To some extent you might expect that something not rising to the level of an emergency (like an urgent care visit) would be something that could be reasonably paid out of savings if necessary, but I'm not sure how much that expectation holds true in practice. I know where I live there's only one insurer that offers out-of-network urgent care benefits, but every place is different.

I'm more worried about something really big happening while I'm traveling. For example, many years ago my relative was on vacation when he developed new-onset type 1 diabetes with DKA and ended up in the ICU for several days. He was unconscious when they brought him in. If something like that happened these days, the initial ER visit would be covered but I would be on the hook for the hospital stay including xray, lab, pharmacy, etc. That could easily run to the millions if there was surgery or an ICU stay involved.  Just wondering if there is some kind of travel policy I can purchase in addition to my ACA plan that would prevent bankruptcy in such a scenario.

[Paul der Krake]

Following. @seattlecyclone 's graph was very helpful but I'm looking for more resources on choosing a plan.

 I'm hoping to pull the plug in six months.  I played with calculators for a couple of possible fire destinations that don't have expanded Medicaid.  With my projected spend I can get my premium and deductible down to $0 after subsidies with a silver epo for the adults and chips for the kids. My biggest fear is getting sick while traveling and having to go out of network. (I know emergency care is covered but it's shocking what isn't considered an emergency). The ppo plans don't look much better than the epos because the oop max seems to only apply in network, and they have a higher deductible. Any suggestions there?

That's something that will depend very much on what plans are available in your area. To some extent you might expect that something not rising to the level of an emergency (like an urgent care visit) would be something that could be reasonably paid out of savings if necessary, but I'm not sure how much that expectation holds true in practice. I know where I live there's only one insurer that offers out-of-network urgent care benefits, but every place is different.

I'm more worried about something really big happening while I'm traveling. For example, many years ago my relative was on vacation when he developed new-onset type 1 diabetes with DKA and ended up in the ICU for several days. He was unconscious when they brought him in. If something like that happened these days, the initial ER visit would be covered but I would be on the hook for the hospital stay including xray, lab, pharmacy, etc. That could easily run to the millions if there was surgery or an ICU stay involved.  Just wondering if there is some kind of travel policy I can purchase in addition to my ACA plan that would prevent bankruptcy in such a scenario.

How can an ICU stay be considered anything other than an emergency?

Maybe I'm just naive but I assumed that if I'm stable enough to travel home, I should do so. If I'm not stable enough to travel, then by definition it is an emergency. This is what Kaiser does:
https://healthy.kaiserpermanente.org/northern-california/get-care/traveling/away-from-home#anchor3

[Morning Glory]

Following. @seattlecyclone 's graph was very helpful but I'm looking for more resources on choosing a plan.

 I'm hoping to pull the plug in six months.  I played with calculators for a couple of possible fire destinations that don't have expanded Medicaid.  With my projected spend I can get my premium and deductible down to $0 after subsidies with a silver epo for the adults and chips for the kids. My biggest fear is getting sick while traveling and having to go out of network. (I know emergency care is covered but it's shocking what isn't considered an emergency). The ppo plans don't look much better than the epos because the oop max seems to only apply in network, and they have a higher deductible. Any suggestions there?

That's something that will depend very much on what plans are available in your area. To some extent you might expect that something not rising to the level of an emergency (like an urgent care visit) would be something that could be reasonably paid out of savings if necessary, but I'm not sure how much that expectation holds true in practice. I know where I live there's only one insurer that offers out-of-network urgent care benefits, but every place is different.

I'm more worried about something really big happening while I'm traveling. For example, many years ago my relative was on vacation when he developed new-onset type 1 diabetes with DKA and ended up in the ICU for several days. He was unconscious when they brought him in. If something like that happened these days, the initial ER visit would be covered but I would be on the hook for the hospital stay including xray, lab, pharmacy, etc. That could easily run to the millions if there was surgery or an ICU stay involved.  Just wondering if there is some kind of travel policy I can purchase in addition to my ACA plan that would prevent bankruptcy in such a scenario.

How can an ICU stay be considered anything other than an emergency?

Maybe I'm just naive but I assumed that if I'm stable enough to travel home, I should do so. If I'm not stable enough to travel, then by definition it is an emergency. This is what Kaiser does:
https://healthy.kaiserpermanente.org/northern-california/get-care/traveling/away-from-home#anchor3

I've heard very good things about Kaiser. My old bighospital is similar: their employee plan covers air ambulance back from anywhere in the world if you become ill or injured while traveling. I now work for state government and my deductible and oop max are pretty low, even for out of network care. It is a scary step, cutting the umbilical cord from that type of plan.  If they made it too easy then everyone would do it :P

[SugarMountain]

Following. @seattlecyclone 's graph was very helpful but I'm looking for more resources on choosing a plan.

 I'm hoping to pull the plug in six months.  I played with calculators for a couple of possible fire destinations that don't have expanded Medicaid.  With my projected spend I can get my premium and deductible down to $0 after subsidies with a silver epo for the adults and chips for the kids. My biggest fear is getting sick while traveling and having to go out of network. (I know emergency care is covered but it's shocking what isn't considered an emergency). The ppo plans don't look much better than the epos because the oop max seems to only apply in network, and they have a higher deductible. Any suggestions there?

That's something that will depend very much on what plans are available in your area. To some extent you might expect that something not rising to the level of an emergency (like an urgent care visit) would be something that could be reasonably paid out of savings if necessary, but I'm not sure how much that expectation holds true in practice. I know where I live there's only one insurer that offers out-of-network urgent care benefits, but every place is different.

I'm more worried about something really big happening while I'm traveling. For example, many years ago my relative was on vacation when he developed new-onset type 1 diabetes with DKA and ended up in the ICU for several days. He was unconscious when they brought him in. If something like that happened these days, the initial ER visit would be covered but I would be on the hook for the hospital stay including xray, lab, pharmacy, etc. That could easily run to the millions if there was surgery or an ICU stay involved.  Just wondering if there is some kind of travel policy I can purchase in addition to my ACA plan that would prevent bankruptcy in such a scenario.

What does this have to do with taxes?  :-/

I would suggest you talk to an insurance broker and/or the insurance companies behind the policies you're looking at.  This has some info: https://help.ihealthagents.com/hc/en-us/articles/224360547-Can-I-Use-My-Health-Insurance-Plan-Outside-of-My-State-#:~:text=The%20Short%20Answer%3A%20All%20plans,is%20in%20your%20plan's%20network.