BCBS Class Action Distribution

[id453]

For those of us that may or may not get a payment through the Blue Cross Blue Shield Subscribers Settlement. Will this distribution be taxable?

Not sure if they will provide a 1099 or not.

[DoninGA]

Whether your Blue Cross Blue Shield (BCBS) Subscribers Settlement distribution is taxable depends on how you originally paid for your premiums. Generally, if you paid your health insurance premiums with after-tax dollars, your settlement payment is likely not taxable. However, if your premiums were deducted pre-tax or you previously claimed them as a tax deduction, the settlement money is generally taxable as ordinary income.

Settlement administrators are typically required by the IRS to issue a Form 1099-MISC (or its current equivalent) to claimants who receive $600 or more. Even if your payout is less than $600 and you do not receive a 1099, the IRS still considers the money legally reportable if it falls into the taxable category.

[id453]

Thanks for the quick reply.

As far as I can tell the Settlement is from the period of February 2008 through October 2020.

During the time of Feb 2008 through April 2018 I was retire but not collecting SS or on Medicare. After April 2018 and beyond I had BCBS Supplement (collecting SS).

All was being paid out of my pocket. Never Itemized my Deductions.

So, am I correct I do not have to pay taxes on this Settlement (approx. $400.00).

Just a FYI. Here is the FAQ on the Settlement.
Who is in the Settlement Classes?

https://www.bcbssettlement.com/faq#q-7

Thanks again.

[DoninGA · Accepted solution]

Since your payments were out of pocket and never deducted on a tax return you would not have to report the settlement income on a tax return.

[id453]

@DoninGA 

Thanks.