Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax
This answer was rated:

My husband received a severance package as part of an involuntary

termination following a change of...
My husband received a severance package as part of an involuntary termination following a change of leadership. Part of the severance agreement was that the company would "reimburse the full cost of the premiums due for COBRA coverage". We have been paying for coverage, submitting receipts and receiving full reimbursement for the past 4 months. In August, we received a partial reimbursement and when we asked, "why?", the company told us that the premium payment was taxable and so federal/state income tax as well as social security, medicare, etc needed to be withheld. They indicated that September's reimbursement would reflect an "adjustment" for the taxes that were not withheld in the previous 4 months. After doing some google research as well as looking at IRS Pub 15, I think the reimbursement is not taxable. Am I correct?
Show More
Show Less
Ask Your Own Tax Question
Answered in 27 minutes by:
9/7/2013
Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 4,050
Experience: 20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.
Verified

Welcome. My name is XXXXX XXXXX it will be my pleasure to assist you with your tax question today.

 

You are correct. Specifically, Publication 15 states as follows:

 

"COBRA premiums. The exclusion for accident and health benefits applies to amounts you pay to maintain medical coverage for a current or former employee under the Combined Omnibus Budget Reconciliation Act of 1986 (COBRA). The exclusion applies regardless of the length of employment, whether you directly pay the premiums or reimburse the former employee for premiums paid, and whether the employee's separation is permanent or temporary."

 

Please let me know if you require further information or clarification.

 

Thank you and best regards,

Barb

Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 4,050
Experience: 20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.
Verified
Barbara and 87 other Tax Specialists are ready to help you
Ask your own question now

Hi, Kristin.

 

Just a short note to thank you for the "excellent" rating and very generous bonus. Both are most appreciated. If you have any questions in the future, please feel free to put "for bkb1956 or Barb" in the subject line, and I will be happy to assist you. Recommendations to family and friends are always also appreciated.

 

Thanks again, and best regards,

Barb

Ask Your Own Tax Question
Ask Barbara Your Own Question
Barbara
Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 4,050
4,050 Satisfied Customers
Experience: 20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.

Barbara is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
I received a letter from the IRS stating that I owed taxes
I received a letter from the IRS stating that I owed taxes on money that I did not claim for 2015. However, I did claim it. They are counting it twice. I submitted all evidence that I have to the IRS,… read more
Barbara
Barbara
Enrolled Agent
4,050 satisfied customers
What are tax implications when docating small IRS to state
What are tax implications when docating small IRS to state university … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Are death benefits taxable in the state of Oregon? My wife
Are death benefits taxable in the state of Oregon? … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Is real estate income taxed only in the state they are
Hi. Is real estate income taxed only in the state they are generated in? For example, if someone owned investment real estate in Texas that has a 0% state income tax and lives in Pennsylvania, would t… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
I need to get a copy of my 2015 state and federal tax. I
i need to get a copy of my 2015 state and federal tax … read more
abci168
abci168
Principal
27 satisfied customers
How can I get an extension to file federal and state taxes
How can I get an extension to file federal and state taxes for 2016 … read more
Barbara
Barbara
Enrolled Agent
4,050 satisfied customers
What are the federal and Oregon state taxes on profit of
What are the federal and Oregon state taxes on profit of sale of my home. My wife and I are age 81 and 77 respectively. I expect the profit will be about $400,000. … read more
abci168
abci168
Principal
27 satisfied customers
REGARDING THE FEDERAL TAX LAW INTHE US. IF ONE RECEIVES
REGARDING THE FEDERAL TAX LAW INTHE US. IF ONE RECEIVES ALIMONY PAYMENTS, WHAT CAN QUALIFY AS TO ***** REDUCE THE TAX ON THE ALIMONY RECEIVED ? CAN BUSINESS LOSES BE CARRIED OVER TO REDUCE THE TAX ON … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Triple tax free ny muni bonds are federal,state and city tax
triple tax free ny muni bonds are federal,state and city tax free. is this correct. if a ny resident moves to ct, do they only pay state tax on the ny muni or all three.… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
734 satisfied customers
Miss are social security benefits taxable by the irs. Are
miss Wilson are social security benefits taxable by the irs … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
What would the federal and state tax rate percentages be for
What would the federal and state tax rate percentages be for a $7700 IRA early withdrawal in Ohio?… read more
Barbara
Barbara
Enrolled Agent
4,050 satisfied customers
This is a question about state income taxes between IL and
This is a question about state income taxes between IL and WI. Earlier this year, my wife and I were living in WI, I worked for a WI employer and she worked for an IL employer. We filed state taxes in… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
734 satisfied customers
US FEDERAL INCOME TAX. QUESTION: A SINGLE WOMAN OWNS A
US FEDERAL INCOME TAX. QUESTION: A SINGLE WOMAN OWNS A HOUSE, HER PRINCIPAL RESIDENCE, AND LIVES IN IT FOR 4 YEARS. IN 2017 SHE MARRIES A MAN WHO WILL ALSO USE IT AS HIS PRINCIPAL RESIDENCE BUT NOT HA… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,220 satisfied customers
Income from federal return incorrectly transferred to state
income from federal return incorrectly transferred to state return … read more
Barbara
Barbara
Enrolled Agent
4,050 satisfied customers
ON A 1041 FORM IS THE TAX FIGURED ON ADJUSTED TOTAL INCOME
STEPHANIE, ON A 1041 FORM IS THE TAX FIGURED ON ADJUSTED TOTAL INCOME MINUS THE 4050 EXEMPTION? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I'm confused with income tax reimbursement letter. Pa. With
Yes with tax return every year I have recipts for stuff I buy … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Is a 1040 US Individual Income Tax Return federal income
Hi Is a 1040 US Individual Income Tax Return federal income taxes owed to the US government? Or is it FICA? I received a letter owing some back taxes and since I'm a priest with a weird set of tax exc… read more
ABC Accounting Group
ABC Accounting Group
Bachelor\u0027s Degree
682 satisfied customers
IRS Federal Tax and State taxes: I filed IRS Taxes late as
IRS Federal Tax and State taxes: I filed IRS Taxes late as well as State taxes for 2012, 2013 and 2014 late in 202016. I have not received any response. I am concerned as this was more than enough tim… read more
ABC Accounting Group
ABC Accounting Group
Bachelor\u0027s Degree
682 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x