The surprising distribution from Horizon BC/BS to its policyholders was part of a $150 million distribution of a portion of refunded Alternative Minimum Tax credits accumulated by the company over 30 years. Please see https://www.horizonblue.com/about-us/our-company/company-information/what-we-re-doing-our-tax-saving...
This would appear to be best classified as a "return of premium," since it represents a pass-through to the company's policyholders of a refund of federal taxes paid as a consequence of premium income over the years.
For individual and small business taxpayers, I would recommend that the payment be treated as a reduction of health insurance premiums paid in 2018. This will, of course, decrease any deduction taken for the Self-Insured Health Insurance Deduction or as an itemized deduction on Schedule A.
The surprising distribution from Horizon BC/BS to its policyholders was part of a $150 million distribution of a portion of refunded Alternative Minimum Tax credits accumulated by the company over 30 years. Please see https://www.horizonblue.com/about-us/our-company/company-information/what-we-re-doing-our-tax-saving...
This would appear to be best classified as a "return of premium," since it represents a pass-through to the company's policyholders of a refund of federal taxes paid as a consequence of premium income over the years.
For individual and small business taxpayers, I would recommend that the payment be treated as a reduction of health insurance premiums paid in 2018. This will, of course, decrease any deduction taken for the Self-Insured Health Insurance Deduction or as an itemized deduction on Schedule A.