How does my HSA contribution affect the MAGI?


Answer

Your HSA contribution lowers your AGI and MAGI qualifying you for more cost assistance (assuming you stay within 100% - 400% of the Federal Poverty Level.) You can learn more about how HSA's work with the Affordable Care Act (ObamaCare) here.

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Jeff Stone on

I’ve read through this and the other HSA related questions and answers and am still wondering whether the one time allowable contribution from a traditional IRA (not Roth) to an HSA is counted as Obamacare MAGI as far as premium subsidies are concerned and whether that distribution from the IRA would be taxed. I’d like to use this one time contribution to establish an HSA and then get an HSA marketplace plan.

ObamaCareFacts.com on

In short, if it is a taxable event, then it is counted toward MAGI. I don’t think IRA to HSA is taxable, thus it shouldn’t be a problem. I’d call healthcare.gov or a tax professional and run it by them… but I believe this to be correct.

Andrew on

Hi, I found this on the healthcare.gov site. It says NOT to report HSA “deposits” as a deduction to lower ACA-related MAGI. I believe that this is an error. Every other deduction in that list is a below the line deduction, and I think HSA deposits got mistakenly lumped in with them. However, I would like to know for sure, as I was relying on my HSA contribution to keep me under 400% FPL.

https://www.healthcare.gov/reporting-deductions/

ObamaCareFacts.com on

I believe that the site is correct and HSA contributions do lower both your AGI and MAGI.