I recently added my partner to my healthcare (medical, dental, and vision) plan through my employer. This benefit is considered imputed income and I'm being taxed more due to the higher "earnings". If I get married and my partner becomes my spouse by the end of 2022...Would these benefits continue to be considered imputed income moving forward? (My understanding is my company would no longer consider it as imputed income once we are married as coverage for spouses and dependents gets a tax break, but I want to double check.)Would the taxes I already paid on the imputed income prior to getting married be available as part of my 2022 tax return? If yes, how much of it if not all? If no, can you please explain why not? Are there any nuances/caveats to how I'd need to file if I got married during the year rather the beginning of the year? For additional context, we are not registered domestic partners and live/work in California. Any information will be helpful! Thank you in advance.

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Question

Does imputed income from employer benefits for a partner—and its taxes—change after marriage?

Forum|Forum|4 years ago
February 25, 2022
1 reply
14 views

I recently added my partner to my healthcare (medical, dental, and vision) plan through my employer. This benefit is considered imputed income and I'm being taxed more due to the higher "earnings". If I get married and my partner becomes my spouse by the end of 2022...

Would these benefits continue to be considered imputed income moving forward? (My understanding is my company would no longer consider it as imputed income once we are married as coverage for spouses and dependents gets a tax break, but I want to double check.)
Would the taxes I already paid on the imputed income prior to getting married be available as part of my 2022 tax return? If yes, how much of it if not all? If no, can you please explain why not?
Are there any nuances/caveats to how I'd need to file if I got married during the year rather the beginning of the year?

For additional context, we are not registered domestic partners and live/work in California. Any information will be helpful! Thank you in advance.

ColeenD3

Level 15

While there doesn't seem to be much that addresses this exact situation, please see this answer from @opus17. In addition, there is a discussion from 2015 at this LINK.

However, if you get married, then you can be added as a spouse, and health care premiums for spouses are not subject to the same imputed income tax. The imputed income should stop as of the date that you are removed from the health plan as a DP and added as a spouse. Normally, employees can only change their health plans during the "open enrollment" period once a year, but a marriage is a qualifying event that allows you to make a change outside the open enrollment period, as long as you notify the benefits office within 30 days of the qualifying event.