Retirement Income Cliff Indicator
See exactly how many dollars you have before crossing an ACA subsidy cliff, an IRMAA Medicare surcharge tier, or the 22% tax bracket. Adjust your MAGI and watch every threshold update in real time.
Your Numbers
ACA Subsidy Cliffs
If crossed: You lose all enhanced ACA premium subsidies above this line. One dollar over can cost $10,000 or more per year depending on your age and state.
Bracket Headroom
If crossed: Income above this point is taxed at 24%. This is the ceiling most planners use for tax-efficient Roth conversions. Standard deduction of $30,000 (MFJ) or $15,000 (single) is factored in.
Using 2026 federal brackets with $30,000 standard deduction. Assumes all income is ordinary income.
Net Investment Income Tax
If crossed: Once your MAGI crosses this threshold, a 3.8% surtax applies to your investment income — dividends, capital gains, and interest — up to the amount you are over the line. It does not apply to IRA withdrawals or Roth conversions.
Your MAGI is below the threshold — no NIIT applies regardless of investment income.
Why these three thresholds matter together
Most retirement planning tools optimize for a single outcome like lifetime net worth or probability of success. What they do not show you is the dollar-level precision you need to make income decisions in a given year. The ACA cliff, the IRMAA tiers, and the tax bracket ceiling are not abstract concepts. They are hard thresholds where a single additional dollar of income can trigger thousands of dollars in new costs.
The reason these three interact so directly is that Roth conversions, Social Security, and traditional IRA withdrawals all count as ordinary income that flows into MAGI. A $25,000 Roth conversion is not just a tax decision. It is simultaneously an ACA subsidy decision and, for anyone approaching Medicare, a Medicare premium decision that takes effect two years later.
This tool gives you a live read on all three so you can size a conversion, a withdrawal, or a part-time income stream with your actual thresholds in view rather than just a best-guess number from a projection model.
Frequently asked questions
What is the ACA subsidy cliff?
The ACA subsidy cliff is the income threshold at 400% of the Federal Poverty Level where premium tax credits end abruptly. For a household of two in 2025, this is roughly $81,760. Earning one dollar over this amount means you lose thousands of dollars in annual subsidies immediately rather than on a sliding scale. Early retirees who manage their MAGI carefully can keep healthcare costs dramatically lower by staying just below this threshold.
How does the IRMAA two-year lookback work?
Medicare determines your IRMAA surcharge tier using your income from two years prior. Your 2026 Medicare premiums are based on your 2024 tax return. This means a Roth conversion or large withdrawal you make today will show up in your Medicare bill two years from now. The indicator shows your current income relative to IRMAA thresholds for the year those premiums will apply, so you can see the real-time consequence of income decisions.
What does tax bracket headroom mean for Roth conversions?
Tax bracket headroom is the amount of additional ordinary income you can add before crossing into a higher federal tax bracket. The 22% to 24% boundary is the most commonly used ceiling for Roth conversion planning because the jump from 22% to 24% is significant and conversions beyond that point often cost more in current taxes than they save in future RMD taxes. Knowing your exact headroom in dollars makes it easy to size a conversion without overpaying.
Why do ACA and IRMAA planning interact with Roth conversions?
Roth conversions count as ordinary income and increase your MAGI, which affects both ACA subsidies and IRMAA Medicare surcharges. A $30,000 Roth conversion that pushes you over the 400% FPL ACA threshold can cost more in lost subsidies than you save in future taxes. Similarly, a conversion that crosses an IRMAA tier adds hundreds or thousands to your Medicare premiums two years later. Effective planning requires looking at all three thresholds simultaneously.
Is this tool free to use?
Yes. The cliff indicator is completely free with no account required. It runs entirely in your browser and does not store any of your inputs. For deeper planning including year-by-year Roth conversion optimization, RMD projections, and a full retirement plan report, ThunderHarbor offers a premium tier starting at $47 per year.
Want a year-by-year picture for your specific situation?
ThunderHarbor maps your ACA exposure, IRMAA trajectory, and Roth conversion headroom across every year of your retirement, with an IRMAA guard that automatically keeps conversions below the next Medicare surcharge tier. Free to start, no credit card required.
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