You will need to report your Polish income as gross income. You can take a foreign tax credit for the foreign income taxes you paid on your income, but not for your social contributions. These social contributions, called FICA taxes in the US, cannot be claimed as a foreign tax credit in the US because they aren't income taxes. Instead, they are used to provide for retirement, disability, and healthcare benefits at a later point in your life.
Yes, you may deduct health insurance on your US return. Health insurance is reported as a medical deduction and is a itemized deduction. You can take advantage of the the medical insurance deduction if you are able to claim itemized deductions for the year.
Itemized deductions are deductions that include medical expenses, gifts from charities, mortgage interest, real estate taxes, and state income taxes you paid during the year. If these itemized deductions exceed $29,200, you may itemize. If you are unable to itemize, then your deduction is the Standard Deduction amount of $29,200.
To report your medical expenses.
- Log into your Turbo Tax return
- Go to deductions and credits
- Medical
- Medical expenses
To claim a Foreign Tax Credit for Taxes paid.
- Log into your Turbo Tax return.
- Go to Deductions and credits. If you are in the software, go to federal first.
- Estimate and other taxes paid
- Foreign Tax Credit>start or revisit
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