November 7, 2026
How Much Room Is Left Under Your 2026 ACA Line?
If you buy health insurance through the ACA marketplace this year, your 2026 credit settles on the tax return you file next spring. Starting with tax year 2026, the IRS requires you to repay any excess advance credit in full. Six weeks remain, and most of your income for the year is already decided.
The pieces still in your control are Roth conversions, realized gains and extra IRA withdrawals. Each one has to happen by December 31. Whether you have room for any of them depends on one number, the distance between your income and the 400% line.
Find Your Line and Your Distance From It
Coverage in 2026 follows the poverty guidelines HHS published in January 2025. Four hundred percent of the poverty level is $62,600 for one person and $84,600 for two. Above that income the credit is zero.
Add up your income so far this year, then add what you still expect to receive. Count IRA and 401k withdrawals, conversions, interest, dividends, realized gains and the taxable part of Social Security. Subtract the total from your line. The result is your room.
What Room Is Worth
Take a couple, ages 60 and 62, living in New Jersey. They project $70,000 of MAGI for 2026. Their room is $14,600. The table shows what their premium does as they use it.
| MAGI for 2026 | Tax credit | They pay for the year |
|---|---|---|
| $70,000 | $16,944 | $6,972 |
| $76,000 | $16,344 | $7,572 |
| $82,000 | $15,744 | $8,172 |
| $84,599 | $15,492 | $8,424 |
| $84,601 | $0 | $23,916 |
From $70,000 to $82,000, the premium rises $1,200. That is 10 cents per extra dollar, because the law asks for 9.96% of income in this range. The couple can add $12,000 of income and pay $1,200 more for insurance.
Two dollars later the premium jumps from $8,424 to $23,916. A $20,000 conversion that takes them from $70,000 to $90,000 raises their premium by $16,944. That is 85 cents of insurance cost on every conversion dollar, before any income tax on the conversion.
The shape matters more than any single number. Inside the line, extra income costs roughly a tenth of itself in premium. At the line, one dollar costs almost $15,500.
What Fits in the Room
A Roth conversion uses room most efficiently, because you choose the amount to the dollar. A realized gain works too, and a stock sale with a large basis uses little room for the cash it produces. An extra IRA withdrawal uses room and gives you nothing beyond the cash, so it belongs last.
Every dollar in the room also carries income tax. The 10 cents of premium is the ACA cost only. Count both before you decide how much to move.
You cannot undo a conversion. Congress ended recharacterization in 2018, so a conversion stays in your 2026 income even if the year turns out differently than you expected.
Leave a Cushion for December
Some income arrives after you plan. Mutual funds and ETFs in a taxable account often pay dividends and capital gain distributions in December. A fund you hold for growth can send you a gain you never sold. Add your best guess for these before you finish a conversion, and leave a few thousand dollars under the line beyond that.
If you are already over the line for 2026, nothing here changes your credit this year. Your next step is the 2027 estimate. If you have a lot of room left, the Roth conversion trade-off is in Roth conversion strategy for early retirees.
Not financial advice
This article is for informational purposes only. Nothing here is financial, tax or legal advice. The couple is an illustrative household, not real people. Premiums are estimates for a New Jersey benchmark plan, and your county’s real benchmark will differ. Income tax on conversions and gains is not included in the table. Confirm figures with a tax professional before you act.
See your room under the line
ThunderHarbor tracks your income against the 400% line each year and shows what a conversion or a gain does to your premium before you do it.
Check my ACA costs