my end of year pension "earnings statement" clearly shows gross earnings, federal taxes and insurance premiums. my net earnings are gross - taxes - insurance, and all numbers add up. However my 1099-r form shows same gross earnings in box 1 and 2a, federal taxes in box 4 and nothing (no insurance premium) in box 5. How can i get tax credit for cost of my insurance. As i see it my insurance is not paid with pre-tax money; cost of the insurance is deducted from the gross distribution.
Yes, you can reduce your taxable pension by your medical insurance premiums, but not directly. You must enter form 1099-R into TurboTax exactly as it appears and please do not change any values. However, you can then go to Deductions & Credits section and enter your medical premiums as your medical expenses.
To enter form 1099-R:
- Federal Taxes
- Wages and Income
- Scroll down to Retirement Plans and Social Security
- Select IRA, 401(k), Pension Plans (1099-R)
Then, please visit medical expenses section:
- Federal Taxes
- Deductions and Credits
- Scroll down to Medical, select Medical Expenses, enter the total amount for all medical insurance premiums that you paid
IRS publication say medical insurance amount can be entered on line 4c and change the taxable amount on line
4d and write POS on the line next to it. TT only lets you put it in itemized deductions and therefore you cannot take the reduction in taxable pension disbursement. You lose the credit if you take the standard deduction. I think TT is wrong on this,. How about an answer TT?