I have quite a bit of money invested in stocks in a Roth IRA, and I'm wondering whether I need to report that income when applying for health insurance coverage.

My gut says no, since that income never shows up on a tax return, but I've been looking through the instructions at https://www.healthcare.gov/income-and-household-information/income/, which say

Include expected interest and dividends earned on investments, including tax-exempt interest.

This sort of makes it sound like maybe this income should be reported?

  • 5
    Tax-exempt interest and dividends generally refers to interest from municipal bonds, dividends paid by mutual funds that invest solely in municipal bonds and such, and not to any earnings within a Roth IRA (or Roth 401k, Roth 403b etc). Such earnings are not income to you until you take a distribution from the Roth plan. – Dilip Sarwate Jul 9 '15 at 16:08
  • @DilipSarwate when are Roth IRA distributions added into MAGI calculations? I don't think that distributions ever are included in MAGI (??) – enderland Jul 10 '15 at 19:43
  • @enderland Qualified distributions from a Roth IRA are not included in AGI since they are not taxable income. However for MAGI purposes, things are different . Nontaxable Social Security benefits are included in MAGI (but not in AGI); the taxable part is in AGI.. The web page on healthcare.gov linked to by the OP says "Include most IRA and 401k withdrawals. (See details on retirement income in the instructions for IRS publication 1040)." in MAGI The "details" don't say that qualified distributions from Roth IRAs are not included in MAGI, but maybe the earnings are included... – Dilip Sarwate Jul 10 '15 at 20:54

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