The $1400 is not taxable.
Here are the benefits of an HRA:
Contributions made by your employer are not included in your gross income.
Reimbursements may be tax-free if you pay qualified medical expenses.
Any unused amounts in the HRA can be carried forward to reimbursements in later years.
Employers have complete flexibility in this area and therefore when designing their plan can offer various benefits.
Reimbursements under an HRA can be made to the following persons except in certain situations as outlined in IRS Publication 969:
Current and former employees.
Spouses and dependents of those employees.
Your child under the age of 27 at the end of the tax year.
Spouses and dependents of deceased employees.
You would be able to deduct amount of your insurance cost in excess of the $1400 paid from your HRA. You do not deduct the $1400 because it is already untaxed money.
