How do I report COBRA on taxes?
Asked by: Robin Marvin IV | Last update: January 19, 2026Score: 4.7/5 (45 votes)
How do I report COBRA payments on my taxes?
Are my COBRA premiums deductible? Yes they are tax deductible as a medical expense. There isn't necessarily a “COBRA Tax Deduction”. You can only deduct the amount of COBRA medical expenses on your federal income tax in excess of 7.5% of your Adjusted Gross Income and then only if you itemize deductions.
Do I get a 1095 if I am on COBRA?
If you had job-based health coverage. Depending on the kind of job-based coverage you had (including COBRA or retiree coverage), you may get one of these from your employer or insurance company: Form 1095-B, Health Coverage. Form 1095-C, Employer-Provided Health Insurance Offer and Coverage.
Where do I enter COBRA payments on TurboTax?
Enter your COBRA premiums under Medical insurance premiums.
Does COBRA get reported on W-2?
In general, each employer providing coverage will have to report the prorated cost on the employee's W-2. If the employee is terminated, the employer can also include the COBRA payment amounts paid by the employee after termination.
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How does COBRA affect taxes?
According to the Federal tax laws, your unreimbursed COBRA payments are, in fact, deductible as medical expenses on your 1040 tax return in the same way that you can deduct unreimbursed payments for legal medical services provided by physicians, surgeons, dentists, and other medical practitioners, as well as any ...
Do I have to report code DD on my tax return?
How can we help? Employers are required to report the cost of an employee's health care benefits in Box 12 of Form W-2 Wage and Tax Statement, using code "DD" to identify the amount. This amount is reported for informational purposes only and is NOT taxable.
What is the tax credit for COBRA?
If your coverage is from a former employer, such as COBRA or retiree coverage, you can decline the employer coverage, even if it is affordable and provides minimum value, and may be eligible for the Premium Tax Credit for your Marketplace coverage.
How do I report COBRA on 1095?
If using form 1095-C for COBRA reporting, you would enter codes 1G and 2A in part II lines 14 and 16, respectively. Line 15 is not required as affordability is not assessed for COBRA individuals.
Is COBRA a self-employed deduction?
If you chose to take COBRA health insurance after leaving a previous job, you may be able to deduct any premiums paid out-of-pocket. However, you are not eligible for the self-employed insurance deduction as the plan is still under your former employer's name.
Do I keep my deductible with COBRA?
If you choose a new plan through the Marketplace, your payments toward your deductible or out-of-pocket maximums will reset and go back to zero. However, if you choose COBRA, whatever you have contributed for the plan year will carry over.
How to get COBRA tax form?
If you haven't received the form you can reach out to your employer/former employer directly or Contact Us for assistance with acquiring the form. Any specific questions regarding tax reporting or filing should be directed to your tax preparer.
How does Form 1095-A affect my taxes?
You will use the information from the Form 1095-A to calculate the amount of your premium tax credit. You will also use this form to reconcile advance payments of the premium tax credit made on your behalf with the premium tax credit you are claiming on your tax return.
What is the tax penalty for COBRA?
The minimum tax levied by the IRS for non-compliance discovered after a notice of examination is generally $2,500. The maximum tax for “unintentional failures” is the lesser of 10% of the amount paid during the preceding tax year by the employer for group health plans, or $500,000.
What is box 14 on W-2?
Box 14 of Form W-2 Wage and Tax Statement allows your employer to enter a variety of information. Employers might use abbreviations and codes in Box 14, and you may need to ask your employer to interpret those abbreviations or codes.
What does code D in box 12 mean?
D – Elective deferral under a Section 401(k) cash or arrangement plan. This includes a SIMPLE 401(k) arrangement. You may be able to claim the Saver's Credit, Form 1040 Schedule 3, line 4. See Form 1040 Instructions for details. E – Code E includes elective deferrals under a Section 403(b) salary reduction agreement.
How do I claim COBRA on my taxes?
COBRA coverage is not incentivized for tax breaks, but like other out-of-pocket insurance premiums, you may be able to deduct COBRA premiums if you itemize deductions. See Deducting Medical Expenses.
Do you get a 1095-B for COBRA?
All individuals with health coverage, including COBRA continuants, should receive documentation of coverage. For an employer with a fully insured plan, coverage information will be communicated by the insurance company furnishing Form 1095-B to the COBRA continuant.
Does COBRA get reported on w2?
If the employer charges a COBRA premium for such coverage, then it must be included in the aggregate reportable cost on the Form W-2.
Are COBRA payments considered income?
If the employee receives the funds and can provide supporting documentation of the payment to the insurer, the funds are also nontaxable. If there is no verification that the employee used the funds to pay for the premiums, the amounts are included in wages and are taxable.
Can you deduct health insurance premiums without itemizing?
Whether you can deduct health insurance premiums from your tax return also depends on a few factors. First, you'll only be able to deduct premiums as medical expenses if you itemize deductions on your tax return, but not if you take the standard deduction. See more details at the bottom of this section.
Are 1099 eligible for COBRA?
Says here "usually, you can't deduct COBRA premiums because the IRS requires the insurance plan be established under your business. Typically, your COBRA plan would be established under the business name of the employer providing the coverage — not under your business."
Do I have to put DD on my tax return?
Individuals (employees) do not have to report the cost of coverage under an employer-sponsored group health plan that may be shown on their Form W-2, Wage and Tax Statement, in Box 12, using Code DD.
Do I have to report box 12a on my tax return?
There are nearly 30 codes that can be put into Box 12 on the W-2 Form. The most common ones are: A: represents uncollected social security or railroad retirement income not collected and must be reported on the tax return. B: represents uncollected Medicare taxes and must be reported on the tax return.
What happens if you don't see box D on W-2?
If your W-2 doesn't have one, it's no big deal. If you get errors when attempting to e-file with an empty box D, just enter any number in this format: 5 digits, space, 5 digits (for example, 12345 67890).