High Deductible Health Plan Contributions - Georgia Taxes

[klmitchells42]

Hey everyone,

I pay for my health insurance out of pocket. I have only had to use it once during 2020. So, I have no real medical expenses outside of the monthly premium. I am trying to figure out whether or not I qualify for the credit. (I pay just shy of $250 a month, have a $50 copay for doctor visits/$75 for urgent care, and have a a "$12,500 deductible then 70/30 to $15,000.")

Thank you.

[KrisD15]

YES, If you paid out of pocket with after tax dollars, and you do not include them in Itemize Deductions, yes

If the premiums are listed on your W-2 as pre-tax dollars, no.

According to our expert @BMcCalpin

"Simply put, your health insurance premiums are normally listed on your W-2 in box 12 with a code of DD. This amount is removed from Wages - thus this amount has been included in determining federal adjusted gross income. And since federal income flows to Georgia, deducting these premiums in Georgia would be a case of double-dipping."

According to the state of Georgia:

"to the extent the deduction has not been included in federal adjusted income" AND "the expenses have not been provided from a health reimbursement arrangement and have not been included in itemized deductions"

TurboTax Original Answer

[klmitchells42]

Just to be clear, do I have to have spent the $7,000 out of pocket this year. This is the first time that I've ever paid for insurance on my own. So, I want to make sure that I do this right.

Thank you.

[ReneeM7122]

Yes, you should be able to qualify for the credit since you have an HSA and paid out of pocket.    Here is IRS Publication 969, Health Savings Accounts.  

Financial institutions report HSA contributions on IRS Form 5498-SA, which is sent to both the taxpayer and to the IRS. You can then report your tax-deductible HSA contributions on Form 8889, with the total contributions transferred to and reported on your Form 1040.

Check this TurboTax article that explains how to calculate the credit: Where do I enter my HSA contribution?

In most cases, your HSA contribution is reported in Box 12 of your W-2 with the code W (Company Contributions to Health Savings Account).

Tip: Code W actually reports the combined contribution – yours plus your employer's. So if you contributed $1,500 to your HSA and your employer matched it dollar for dollar, Box 12 on your W-2 would show $3,000 with a code W.

But what if I made an HSA contribution that wasn't reported on my W-2?

We'll ask about this uncommon situation when you step through the Medical section. Look for the questions Were HSA contributions made in 2020? or Do you need to make any adjustments to your HSA contribution amount? When you answer Yes, we'll open a screen where you can enter your contribution.

@klmitchells42