|
tax deduction for retiree health ins premiums
03-03-2012, 03:56 PM
|
#1
|
Confused about dryer sheets
Join Date: Dec 2011
Location: tampa
Posts: 3
|
tax deduction for retiree health ins premiums
Does anyone know of an instance where Health Insurance Premuims we now pay as a retiree for health insurance through fomer employer 's plan would be able to be tax deductible. just seems that it should be as it was paid with pretax money while an active employee.
this seems to unfairly burden early retired people who can't go to medicare, but remain on company plan as early retirees. (not to mention it's also more expensive than employee 's premium)
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
03-03-2012, 04:12 PM
|
#2
|
Dryer sheet aficionado
Join Date: Dec 2010
Posts: 28
|
I believe Health insurance premiums and Cobra premiums are qualified medical expenses for HSA purposes.
If you don't have an HSA, your insurance premiums are considered medical expenses. Medical expenses are deductible to the extent they exceed 7.5% of your AGI.
|
|
|
03-03-2012, 04:29 PM
|
#3
|
Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,708
|
Yes, health insurance premiums are deductible medical expenses, even in early retirement.
Steven and katste12, welcome to the forum. Why not stop by and introduce yourselves here Hi, I am... - Early Retirement & Financial Independence Community
|
|
|
03-03-2012, 07:08 PM
|
#4
|
Thinks s/he gets paid by the post
Join Date: Jan 2006
Posts: 4,172
|
Unfortunately, as mentioned previously, you can only deduct the insurance premiums, to the extent that medical expenses (including the premiums) exceed the min. floor amount of 7.5% of AGI and even if they do exceed that floor are only useful if you itemize so employees who make pre-tax payments do have an advantage.
|
|
|
03-03-2012, 07:18 PM
|
#5
|
Thinks s/he gets paid by the post
Join Date: Feb 2007
Posts: 3,681
|
We never have enough deductions to itemize for Federal, but this was the first time we had enough for a medical deduction for our state taxes and our un-subsidized dental insurance premiums counted toward that. Our medical is subsidized through the retiree plan but for the dental we pay the full amount.
So check if it will help you for your state taxes.
__________________
Married, both 69. DH retired June, 2010. I have a pleasant little part time job.
|
|
|
03-03-2012, 09:44 PM
|
#6
|
Administrator
Join Date: Jul 2005
Location: N. Yorkshire
Posts: 34,124
|
Unfortunately kaneohe is correct.
As an employee the premiums are paid with before tax money regardless of your income or deductions. It was a nice tax subsidy I also lost as an ER. My company also had an FSA scheme for employees where we put before tax money to pay out of pocket expenses including OTC drugs, eye tests, dental, glasses etc.
Rather than thinking of it as unfair, you should consider it as a worker's tax-free perk you no longer have.
__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Enough private pension and SS income to cover all needs
|
|
|
03-04-2012, 09:03 AM
|
#7
|
Confused about dryer sheets
Join Date: Dec 2011
Location: tampa
Posts: 3
|
I guess that a good way to look at it.
We miss out taking it on sched a - never reach the 7.5% to be able to itemize
thanks for the help
|
|
|
03-04-2012, 09:04 AM
|
#8
|
Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,708
|
Quote:
Originally Posted by Alan
Rather than thinking of it as unfair, you should consider it as a worker's tax-free perk you no longer have.
|
+1
|
|
|
03-04-2012, 09:22 AM
|
#9
|
Thinks s/he gets paid by the post
Join Date: Jan 2006
Posts: 4,172
|
Quote:
Originally Posted by Steven
I believe Health insurance premiums and Cobra premiums are qualified medical expenses for HSA purposes.
.
|
True for Cobra but not medical insurance premiums in general according to this see p. 8-9 http://www.irs.gov/pub/irs-pdf/p969.pdf
|
|
|
03-06-2012, 04:28 PM
|
#10
|
Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Chicago
Posts: 1,154
|
Quote:
Originally Posted by kaneohe
Unfortunately, as mentioned previously, you can only deduct the insurance premiums, to the extent that medical expenses (including the premiums) exceed the min. floor amount of 7.5% of AGI and even if they do exceed that floor are only useful if you itemize so employees who make pre-tax payments do have an advantage.
|
Ah, yes, another deduction to make the cost of my new mortgage even cheaper. OH OH, sorry I must be on the wrong thread.
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Thread Tools |
|
Display Modes |
Linear Mode
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|