# Should a Low Income College Student Buy Insurance Through the Obamacare Marketplace?

I am an American college student. For 2016, I've made around $8,000 working. My parents, who are not American, and thus live and work overseas have been paying my rent which when I add the money they've given me to the$8,000 comes in at around \$22,000. Trying to be prudent, I enrolled early for a marketplace plan. The application said to estimate my income, use my AGI (which is negative), and then add any untaxed income. Thus in the marketplace application I added the money my parents gave me and the estimate came out to around 16,000. This qualified me for a subsidy.

Now I'm wondering if I followed procedure correctly, and whether or not I should cancel my insurance to avoid having to pay thousands of dollars at the end of the year if it is true that I didn't follow procedure correctly (Not sure if that's even how it works). I could very well be overthinking thinks, but I would input from someone more experienced. So what do you guys here think?

A. Cancel My Insurance

B. Stop Overthinking. It's not that complicated.

• Are you here on a student visa, or are you a resident alien or citizen? – Nathan L Feb 23 '17 at 4:27

Gifts from your parents are not treated as income for tax purposes. You should not include that in your subsidy calculation.

If you are here on a student-visa and have been in the US for less than 5 years, then you are considered a non-resident alien, and you are not required to buy a qualified plan through the insurance marketplace. You might be able to get a cheaper student plan through your school, but the subsidy might be enough that it's still worth it when calculated correctly.

If you are a resident-alien or you are a citizen of the US, then you are required to get coverage, though you can choose not to purchase coverage and pay the tax for not having creditable coverage. That tax cannot be collected by the IRS unless you have already had federal tax withheld. They can only confiscate your tax return money to recoup that money.

I don't have enough information to recommend one way or the other what you should do, but I would bet that if you recalculated your subsidy without including your parents income it would cover the majority of the cost.

You should also consider applying for Medicaid if you meet the eligibility requirements in your state.

• With income of 8K, wouldn't that qualify him for Medicaid? – TTT Feb 23 '17 at 19:10
• @TTT - Likely, yes, but there are a lot of missing details here. What state he is in, for starters. – Nathan L Feb 23 '17 at 19:26
• @TTT - I left it out because I didn't know for sure that he was eligible, but you're right, it doesn't hurt to suggest looking into it regardless. – Nathan L Feb 23 '17 at 19:34
• @TTT Even if he's not qualified for Medicaid, with a negative AGI, he'll be eligible for the max subsidy. He should revise his paperwork and get the best plan. He's in the group the ACA was designed to help. – Xalorous Feb 23 '17 at 22:18