Health Insurance Deduction/Retirement

[mblatour]

Me again!

I have another question. I have a couple where the husband retired in 2005. I asked them if they had any out of pocket medical expenses for Itemizing on Sch. A and they gave me their medical bills that they had co-pays on. That part I get.

Now, I asked if they paid for their insurance premiums out of pocket and was told that the medical/dental/vision premiums are taken out of the pension check on a monthly basis. From what they told me, there is the gross amount, then his wife's retirement is removed and then the $702 in medical premiums is removed. He believes they come out after tax and not before; so therefore he is being taxed on it.

It's a regular Union Pension Fund Retirement and he is drawing under Distribution Code 7. On his 1099R I am given the gross distribution of $28,943, the Taxable Amount of $28,895, and the Federal Income Paid of $1672. That's it on the form.

How do I tell if there is a deduction here? My gut says no because it should/would have been reported on the 1099R.

Any advice?

[mblatour]

what the IRS said

I just got off the phone with IRS and was told that the expenses are deductible on Schedule A if they were paid by himself. She said just take the amounts off his paystubs that he paid, add them up and put them on Sch. A after the 7.5%.

I guess I questioned it because I haven't actually seen the stubs, I only have what the 1099R says.

[ecb34691]

He paid for them by having them deducted from his pension instead of getting a net amount and writing a check to the insurance company. Have never heard of retiree have pre-tax medical deductions. If you do any retired Federal employees, the CSA1099R will show how much was paid by the retiree for their health insurance.