You can report the COBRA payments as medial expenses. In 2020, the IRS allows all taxpayers to deduct their total qualified unreimbursed medical care expenses that exceed 7.5% of their adjusted gross income if the taxpayer uses IRS Schedule A to itemize their deductions.
When you enter your expenses, TurboTax will do the math and let you know whether the standard or itemized deduction is the best choice for you.
Enter your COBRA payment following these steps in TurboTax:
- Federal
- Deductions and Credits
- Medical Expenses
- Go though the screens and enter any expenses that you paid and were not reimbursed for
- At the screen How much did you spend on insurance premiums? enter the total amount you paid for COBRA i 2929.
- Go though the other screens and enter any applicable amounts
After you finish with all credit and deductions and wrap up tax breaks a screen will appear that tell s you if the standare or itemized deductions are right for you.
If you take the standard deduction in 2020, you can also claim up to $300 in cash donations to charity. Claiming that deduction will reduce the amount owed or increase the refund.
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