Question for Anyone That Works in Human Resources????

Deductions for health care plans would only reduce taxable gross income if the employer chose to offer pre-tax contributions and met requirements under Section 125 to offer. Section 125 is the section of the tax code that people usually think of in connection with "cafeteria plans" but it applies to a premium conversion only plan as well, meaning that there is still a choice between "cash" and "non cash, non taxable" compensation. Some Section 125 requirements are pretty simple - like having the plan in writing and distributing to employees and making an annual choice. Other requirements, like non-discrimination requirements and annual testing might be the obstacle to offering pre tax contributions especially for a smaller employer. Check with your husband's employer - probably the payroll dept - to see if they are offering pre-tax contributions or not.

Pull out your husband's company work book - even small companies have them.

Some insurance's are pre-tax, others are not. Check with the "payroll" department and find out their "plan" is. If they are not pre-tax, you can deduct those payments from your taxes.

Some health insurance is pre-tax and some is post-tax. Did the w-2 reflect the insurance premium at all? If not, it is definately inaccurate either way (should show the amount paid...depending on pre- or post- tax would determine in what box that figure should be in). Your husband should contact HR or Payroll to inquire about that. If he doesn't know who that is, he should be able to go to his manager and ask.

I think the person to ask the question of is actually "payroll". I used to do HR and we didn't handle this part. However I believe that health insurance is still taxable since it is part of his salary. The only part that would be non-taxable would be if it was a contribution to a flexible spending account for reimbursement of medical expenses or child care. Since these things are regulated by the Federal Goverment it's treated differently as there is a federal law explaining how it's to be handled.

I believe that's the case.

UPDATE: Looks like I was wrong or there may have been a law change: http://wiki.answers.com/Q/Will_medical_insurance_premiums...

I would have your husband find out who does payroll. SOMEONE internally handles this and may not be aware of this mistake. It looks like you should still be able to make an adjustment on your own taxes. But I would still take the issue up with the "payroll" person to correct this mistake for 2011.

I am not sure if it is a requirement for employers to do that, but these links lead me to believe that if they do not you can deduct the premiums you paid if they were taxed as part of the gross income.

http://www.irs.gov/publications/p502/ar02.html#en_US_publ...#
(Employer-Sponsored Health Insurance Plan-Do not include in your medical and dental expenses any insurance premiums paid by an employer-sponsored health insurance plan unless the premiums are included in box 1 of your Form W-2, Wage and Tax Statement. Also, do not include any other medical and dental expenses paid by the plan unless the amount paid is included in box 1 of your Form W-2. ) This sounds like your situation.

http://www.ehow.com/about_###-###-####_can-deduct-health-...

http://healthinsurance.about.com/b/2010/01/25/are-my-heal...

You need to talk to the Payroll dept or company to find out if they count it as pretax or not. They don't have to do that, but I believe you can on your taxes.

I'm not an HR person, but in the past when my health insurance was not taken out of my pay pretax, I was able to write off all my health expenses on my taxes because I would reach that magical amount that makes that possible. You should double check it because if they did take it out pretax and did not prepare the W-2 correctly then you can't write it off for sure.

So, double check with your payroll folks and then talk a tax preparer about whether you can write it off.