If an employee pays the premiums on personally owned health insurance
or incurs medical costs and is reimbursed by the employer, the
reimbursement generally is excluded from the employee’s gross income and
not taxed under both federal and state tax law. This includes premiums
for tax dependents and opposite-sex spouses. However, there are some
circumstances in which the reimbursement is taxable income, including
the following:
- If an employer simply pays the employee an extra amount and does not
specify in writing that the amount must be used to pay the health
coverage premium, it will be taxable to the employee as income.
- If the employer is self-employed, any reimbursements for their own
or their dependents’ health care costs are taxable income to the
self-employed employer.
http://healthcoverageguide.org/reference-guide/laws-and-rights/tax-implications/
**Answers are correct to the best of my ability but do not constitute tax or legal advice.
