Health Insurance Concerns
Dear Liz: My wife and I currently have health insurance through affordable care options. However, with the enhanced tax credits finishing this year, our monthly premiums might jump from $500 to approximately $2,000. Are there any recommendations you might have for us? If my wife qualifies for medical coverage based on her income, could you assist with filing taxes separately?
Answer: Currently, there’s no ACA premium for the next year, but we anticipate significant coverage cost increases after Congress eliminates the more affordable premium tax credits.
According to estimates from Healthcare and KFF’s Peterson Center, this shift could lead to an average rise of about 75% in out-of-pocket premium payments next year. Moreover, insurance companies are looking to increase premiums to manage the escalating healthcare costs, with tariffs possibly driving up the prices of drugs, medical devices, and supplies even further.
Take your time while shopping for plans, and consider high-deductible options that might help manage your overall costs. It may also be worth consulting a tax professional about strategies to lower your income in 2026, which could help you qualify for a premium subsidy.
Just changing how you file taxes won’t allow your wife to qualify for the medical assistance. This program, which is California’s version of Medicaid for low-income individuals, looks at household income to determine eligibility. While separating assets might have its merits, it comes with numerous legal and tax considerations, so it’s a good idea to speak with legal and tax advisors about it.
Charitable Contributions from an IRA
Dear Liz: Hi there! If I’m required to make a minimum distribution, I’d like to use my IRA for charitable contributions.
However, I am running into an issue. I want to make my donation via debit card; I plan to contribute to a small art organization that only accepts online donations, not checks.
I found a brokerage offering IRAs with debit card features, but they informed me that these cards can’t be used for charitable donations. I’m really confused. Do you know if it’s possible to make a charitable donation from my IRA using a debit card? It seems like someone should have come up with a solution by now, right?
Answer: It looks like a key aspect of how this tax benefit operates might have slipped through the cracks.
Qualified charitable contributions allow individuals aged 70½ or older to donate directly from their IRAs to charities without incurring any tax on the funds. These donations can also count toward the required minimum distributions that must start at age 73 (or 75 for those born post-1960).
It’s important to note the significance of “direct.” The transfers need to come straight from the IRA to the charity without passing through your hands first. An IRA custodian will handle the transfer, sending the funds either electronically or via check.
