Deductions & credits

If you are asking "can you deduct the medical payments that were deducted from your monthly retirement pay and paid directly to your insurance carrier for your health insurance on your Schedule A as a medical expense", the answer is no but you can exclude that amount up to $3,000 from your taxable income. Please see the instructions below to ensure that the eligible amount withheld will be excluded from your taxable income:

1. Launch TurboTax and type in Form 1099-R by the magnify glass in the search panel
2. Select Jump to 1099-R
3. Add your 1099-R or edit the 1099-R that had your health insurance deducted
4. Go through the questions and make sure to answer Yes to “this money came from employment as a Public Safety Officer (PSO)”
5. Enter Yes to “money was taken out to pay for health insurance”
6. Enter the amount of your pension that was paid directly to the plan administrator for health insurance.

If you are using TurboTax Desktop, you can select Forms at the top of the page, scroll down on the left and highlight 1040. Line 5a will show the total amount of your pension (there will also be “PSO” beside it). Line 5b will show the taxable amount. Up to $3000 will be subtracted from your taxable amount (which is excluded from your taxable income) for the health insurance premiums that the plan administrator paid directly to your health insurance carrier.

If you are using TurboTax online, you must pay for TurboTax before you can view the forms.  Select Tax Tools from the menu on the left, With the Tax Tools menu open, you can then:

• Preview your entire return: Select Print Center and then Print, save, or preview this year's return 
• View only your 1040 form: Select Tools. Next, select View Tax Summary in the pop-up, then Preview my 1040 in the left menu.