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Maverickd
New Member

How do I calculate the amount I pay for imputed income?

I have to pay tax on my health insurance now that I’m divorced. My paystub shows the amount I pay for my coverage each pay check. It’s taken out pre-tax but then below that they add the amount back to my income. I’ve read about what imputed income is and my employer doesn’t charge me a percentage of the health insurance cost, they add the entire amount back so I’m taxed on the full amount. How can I figure out how much this costs me monthly?
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1 Reply
Carl
Level 15

How do I calculate the amount I pay for imputed income?

Since you arleady know what imputed income is, there's no need to refer you to https://www.patriotsoftware.com/payroll/training/blog/a-closer-look-at-imputed-income/ (I put it here for others reading this thread).

Your employer has already done the math and you don't have to do anything. It's already included in box 1 of your W-2.  Do note that since it's for health insurance, the insurance costs can be included as a medical expense for inclusion on SCH A. Of course, until the total of all of your medical expenses exceed 2% of your AGI, they won't make any difference to your tax liability.

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