My TurboTax friends,
Is there a way for me to pay for my COBRA premiums with pre-tax retirement dollars without taking that amount as income for that tax year? And no 10% early withdrawal penalty. And without having to Itemize Deductions (>7.5% AGI 2019, >10% AGI 2020).
Situation:
* Unemployed, have already received 12 weeks of unemployment benefits.
* I have some 401(k) accounts. I don't have a Traditional IRA, but could roll 401(k) money into one, if needed.
* Paid first self-paid COBRA payment in Dec19. Prior COBRA payments were covered as a part of severance. I'm still paying for COBRA out of pocket in tax year 2020.
* I don't want to take a hardship withdrawal from a 401(k) and I don't know if my it'd qualify for it.
* I'm <59.5 years old.
I understand that I could roll some 401(k) money into a Traditional IRA and take a distribution from the Traditional IRA without the 10% early withdrawal penalty, but I'm trying to find a mechanism to pay these premiums with pre-tax money, just as I paid my health insurance premiums with pre-tax money with my old employer.
Thanks!
