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W2 medical $ in box 1

February 11, 2017 • Kyrsten Gallo • Log In to Post Comments

Is there anyway to deduct the amount an employee receives from their employer as income in box 1 for for the purpose of paying for health insurance on their own besides medical expenses on schedule A conditional to over 10% of their AGI?  This completely inflates their income and doesn't give them a deduction because their AGI is ~$175K and the medical insurance premium expense is only ~12.5K.  Is there any treatment of this that I am missing?  

Thank you. 


Comments

Krysten,

Almost all employer-sponsored health insurance is paid for pre-tax and should not be included in Box 1.  However, in the rare event that the health insurance is after-tax and is included in box 1, then Schedule A is your only recourse unless your client also has self-employment income or the employer is an S corporation and your client owns 2% or more of the stock.  In that event, your client can deduct the health insurance as an above-the-line deduction on their 1040 as self-employed health insurance.

 

 

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