My employer pays 50% of my health insurance premium and she deducts the other 50% from my salary. Is the amount deducted subject to payroll taxes? Do I compute the taxes first and deduct the premium or deduct the premium first before computing for the taxes?
2007-05-14 10:55:59 · 5 answers · asked by JBC 1 in Business & Finance ➔ Taxes ➔ Other - Taxes
It can go either way. If you have a pre-tax plan or after tax plan.
Find out from your employer.
2007-05-14 11:47:39 · answer #1 · answered by Mark S 5 · 1⤊ 1⤋
Virtually all health insurance plans that require an employee payment are pre-tax. The amount you paid has already been deducted from your gross income reported in Box 1 of your Form W-2. You don't need to take any further action as it's already been accounted for.
2007-05-14 20:26:41 · answer #2 · answered by Bostonian In MO 7 · 1⤊ 0⤋
It depends on if your health insurance plan is pre-tax or post-tax. Plans have to meet IRS guidelines in order to be pre-tax (cafeteria plans, etc.).
If your plan is pre-tax, you deduct the amount of your insurance payments from your gross pay *before* computing the taxes. If your plan is post-tax, you do not deduct the amount before computing tax figures.
Ask your supervisor or HR representative for details on your plan. :)
2007-05-16 00:13:35 · answer #3 · answered by forsythia75 2 · 0⤊ 0⤋
Use TurboTax, and it will be handled automatically. The program will take you step by step on this issue. Count your gross wage, and later on your tax form it will ask about insurance premiums deducted from your salary. Read instructions for the tax form you are using.
2007-05-14 16:25:56 · answer #4 · answered by Diane 2 · 0⤊ 2⤋
http://www.teamcorp.com/tc4486
2007-05-15 14:01:10 · answer #5 · answered by Anonymous · 0⤊ 0⤋