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I am a retired Firefighter. I pay all our Health Insurance premiums after-tax from my pension. How do I self designate to claim the $3,000 deduction when filing with TurboTax?

 
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AnnetteB6
Employee Tax Expert

I am a retired Firefighter. I pay all our Health Insurance premiums after-tax from my pension. How do I self designate to claim the $3,000 deduction when filing with TurboTax?

Health insurance premiums for an eligible retired Public Safety Officer are not explicitly shown as a deduction on your tax return.  Instead, the amount that was paid is excluded from the taxable portion of the retirement plan distribution.  

 

You can see this by looking at your Form 1040.  Line 5a includes the total amount of distributions reported from pensions and annuities.  Line 5b includes only the taxable portion of those distributions.  If health insurance premiums for an eligible retired Public Safety Officer are reported, then Line 5b will be less than Line 5a by the amount of the premiums, up to a limit of $3000.  

 

As you are going through your return to enter the Form 1099-R reporting retirement plan distributions, there will be a follow-up question that asks whether you were employed as a public safety officer.  Then, a second question asking for the amount of health insurance premiums can be entered and excluded from that taxable income.

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I am a retired Firefighter. I pay all our Health Insurance premiums after-tax from my pension. How do I self designate to claim the $3,000 deduction when filing with TurboTax?

FWIW- I am using the online version and not able to see the 1040 form declarations as I input data.  I found a "work around" digging through other replies.  2023 Law Change for Retired Police Officer Deduction for Health Care Insurance Premiums (intuit.com) The online TurboTax version requires fudging an answer on the 1099R follow-up questions in order to receive credit on TurboTax. When answering the question "Did the pension administrator take out money for NAME's pension to pay for health insurance?", the filer needs to answer yes, even if they paid those "out of pocket". I had paid premiums myself since my retirement plan administrator did not participate. Retired Public Safety Officer filers using online TurboTax, who unaware of the Jan 2023 change in the law, may easily miss this valuable reduction in taxable income. 

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