Risks of not estimating income accurately for ACA tax credits + cost-share reduction (good faith estimate)

Hey everyone. I’m in a bit of a tricky situation with regard to ACA tax credits, CSR, and estimated income.

I’m self-employed, but plan to scale back for the foreseeable future due to health concerns. Thus, the majority of my income will come via dividends + capital gains from my brokerage account. I anticipate being at an income level that would qualify me for the ACA tax credit + cost-share reductions on a Silver plan. The problem is, I’m worried that my actual income may end up not matching my estimated income for the year. Given the variable nature of both my self-employment income and dividend/capital gains income, I may be off by up to $15k. My dividend income is highly dependent on Fed interest rates, which may raise or lower at any time.

From what I understand, this won’t be a problem if it happens for a single year (I won’t have to pay back CSR plan subsidies, but I may have to pay back some of the ACA tax credits I received, which is fine). My worry is that if my estimated income is off for several years in a row, I would be barred from enrolling in cost-share reduction Silver plans ever again, or even receiving ACA tax credits.

Given that I have health problems that make me an active user of my plan, not being able to enroll in a CSR Silver plan in the future (if I have multiple years of incorrect estimated income), even though I’d qualify for it would be really bad for me.

Given that I am making good-faith estimates of my income which may turn out to be incorrect, what should I do? How can I feel secure knowing that I’ll be able to enroll in CSR plans in future years (that I qualify for) + continue receiving ACA tax credits?

Thanks for your help!

submitted by /u/btcctbbb
[comments]