Employer Medical Insurance Paid Post Taxes

[jeffandkarleen]

My husbands employer has been deducting our medical insurance premium post tax for the last 18 years. We just noticed this. I know we can only go back 3 years to claim but we did not itemize the last 3 years. We will however itemize for this year. Can I claim this when we do our taxes for 2025?

[Mike9241]

if they are truly post-tax you can deduct as a medical expense those insurance premiums taken from his paycheck. However, to be of tax benefit those premiums plus other medical expenses must exceed 7.5% of your adjusted gross income.

[xmasbaby0]

If you itemize deductions instead of using standard deduction then you can enter your out of pocket medical expenses including health insurance premiums paid out of pocket.   It is, of course, very difficult to meet the threshold to actually get a medical expense deduction.

MEDICAL EXPENSES

The medical expense deduction has to meet a rather large threshold before it can affect your return. The amount of medical (including dental, vision, etc.)  expenses that will count toward itemization is the amount that is OVER 7.5% of your adjusted gross income. You should only enter the amount that you paid in 2024—do not include any amounts that were covered by insurance or that are still outstanding.  Of course, your medical expenses plus your other itemized deductions still have to exceed your standard deduction before you will see a difference in your tax due or refund.

To enter your medical expenses go to Federal>Deductions and Credits>Medical>Medical Expenses

2024 STANDARD DEDUCTION AMOUNTS

SINGLE $14,600    (65 or older/legally blind + $1950)

MARRIED FILING SEPARATELY            $14,600    (65 or older/legally blind + $1550)

MARRIED FILING JOINTLY $29,200    (65 or older/legally blind + $1550)

HEAD OF HOUSEHOLD $21,900    (65 or older/legally blind + $1950)

2025 STANDARD DEDUCTION AMOUNTS

SINGLE $15,000   (65 or older/legally blind + $2000

MARRIED FILING SEPARATELY $15,000   (65 or older/legally blind +1600)

MARRIED FILING JOINTLY 30,000   (65 or older/legally blind + $1600)

HEAD OF HOUSEHOLD $22,500  (65 or older/legally blind + $2000

[jeffandkarleen]

Yes I know and understand that. 

That is not my question though. 

[jeffandkarleen]

This is still not answering my question. 

[jeffandkarleen]

My husbands employer has been deducting our medical insurance premium post tax for the last 18 years. We just noticed this. I know we can only go back 3 years to claim but we did not itemize the last 3 years. We will however itemize for this year. Can I claim this when we do our taxes for 2025?

[jeffandkarleen]

My husbands employer has been deducting our medical insurance premium post tax for the last 18 years. We just noticed this. I know we can only go back 3 years to claim but we did not itemize the last 3 years. We will however itemize for this year. Can I claim this when we do our taxes for 2025?

[xmasbaby0 · Accepted solution]

This question was answered in both of the replies you already received.   Out of pocket medical expenses  for 2025 can be entered for 2025.   Whether those expenses have any effect on your tax due or refund is questionable, because first you have to meet the 7.5% of AGI threshold for medical expenses, and also meet the threshold to itemize deductions.

I hope we are not misunderstanding your question.  You have mentioned "going back three years" more than once in these posts.   Are you asking if you can go back three years and put the past three years of out of pocket health insurance premiums on your upcoming 2025 return?  If that is what you are asking, the answer is NO.    Only medical expenses paid in 2025 can  be entered on a 2025 tax return.

[Opus 17 · Accepted solution]

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@jeffandkarleen wrote:

My husbands employer has been deducting our medical insurance premium post tax for the last 18 years. We just noticed this. I know we can only go back 3 years to claim but we did not itemize the last 3 years. We will however itemize for this year. Can I claim this when we do our taxes for 2025?

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You can only deduct premiums paid in a given year on that year's tax return.  You can't deduct missed premiums from a past year in a future year.  

Your employer also needs their [removed] kicked.  By not taking advantage of section 125, not only are they over-taxing their employees, they are over-taxing themselves.  (On the other hand, to use the section 125 pre-tax deduction of premiums, they must follow certain rules about fairness and non-discrimination.  If they don't want to follow those rules, then they can't use pre-tax deductions, so maybe it was intentional.)

[Mike9241]

there is one possibility that was not explored. That he's a 2% or more shareholder of an S-Corporation. in that case not deducting the insurance from taxable wages was proper. In fact, those premiums should have been added to his wages by his employer (the amount would usually be noted in box 14 of the w-2). Then on your 1040 tax return you would take a self-employment health insurance deduction. 

[jeffandkarleen]

yes this answered my question

I hope we are not misunderstanding your question.  You have mentioned "going back three years" more than once in these posts.   Are you asking if you can go back three years and put the past three years of out of pocket health insurance premiums on your upcoming 2025 return?  If that is what you are asking, the answer is NO.    Only medical expenses paid in 2025 can  be entered on a 2025 tax return.

Thank you!

[jeffandkarleen]

Yes this answered my question

You can only deduct premiums paid in a given year on that year's tax return.  You can't deduct missed premiums from a past year in a future year. 

We are not for certain if it was our fault or their's. But now it is what is. 

Thank you!!

[jeffandkarleen]

He's not a share holder. 

But this is good to know. 

Thank you!