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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15176
Experience:  15years with H & R Block. Divisional leader, Instructor
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My employer deduct health insurance from every pay cheque

Customer Question

My employer deduct health insurance from every pay cheque and company add the same amount for health insurance premium.My W2 shows yearly income after the health insurance deduction.Somebody told me that I can not include the health premium deduction in gross pay and my gross pay is what is shown on W2. I have filed I-140 and need to know if this is correct and gross pay do not include the health insurance deduction made by employer.
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.


When an employer takes out your costs for health insurance "pre-taxed" that means that the amount was not included in your wages when your employer calculated how much tax to withhold.

That was a benefit for you because you were able to pay your premium with money that was not taxable.

That is why an employee does not also use the same amount on their Schedule A as a deduction too.

Your Gross pay would only be the amount that shows on your W2 box 1.

Add nothing to that nor do you need to subtract any amount.

The amount your employer paid is not included anywhere for you as income.

If my answer addressed your question please rate below or above (let me know if you have difficulty as I believe the system changed), if you need more information reply below.

Customer: replied 1 year ago.
If my employer pay the health insurance amount to me and I arrange the health insurance at my own then in this case will I get tax exemption on the amount that I am paying for health insurance? If yes then what difference does it make if employer is paying the health insurance or me?
Expert:  Robin D. replied 1 year ago.

The difference comes in how the money is paid to you or for you.

If you were given the money then it would be included in your taxable income and you could then use it as a deduction on Schedule A.

When it is paid for you on a pretax basis you already receive a deduction because it is not in your taxable income from the start.