Last year I decided to go with the individual healthinsurance plan from BlueCross. Prior to that I was with my employer's medical plan (cafeteria plan) - where I was getting the pre-tax dollar benefit. But with the individual plan that I am in, I wanted to ask if I am eligible for a similar pre-tax dollar benefit - what can be done rather than pay a higher tax. I am on a W2. Do not have any company / corp. under my name. Thanks.
The premiums for your employer's medical insurance plan are paid with pre-tax funds, under a plan established by the employer. Your BlueCross premiums are paid with after-tax funds, but are deductible on Schedule A (subject to the 7.5% of AGI limitation). Your pre-tax premiums (company plan) cannot be deducted on Schedule A.
You can add the insurance premiums to any other deductible medical expenses that you claim on Schedule A. Total medical expenses are reduced by 7.5% of AGI to determine the actual deductible amount. If your total medical expenses, including the insurance premiums, are less than 7.5% of AGI, then you have no deduction. Bob Sandler
What if he qualifies for a health care savings account. Can the insurance premiums be paid from that account? Stu
I am certainly NOT sure but...... If his employer has a Flexible Spending Account (which are usually funded with pre-tax dollars) can he use his premiums as reimbursable items under the FSA??
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