Robert works for American Motors. American Motors pays a $1,200 premium on Robert's health insurance in 2011. Robert has an operation on his big toe in 2011 that cost $7,200. The insurance company paid for $6,800 of it. Which one of the following is true?

Answer

1. Robert has to claim the $1,200 premium paid by his employer as income in 2011.

2. Robert must claim the $6,800 paid by the insurance company for the operation as income in 2011.

3. Robert must claim the $1,200 premium and the $6,800 insurance payment as income in 2011.

4. None of these events are taxable on his 2011 return.

Question

Business

Haylie Trujillo

23 November, 21:42

Robert works for American Motors. American Motors pays a $1,200 premium on Robert's health insurance in 2011. Robert has an operation on his big toe in 2011 that cost $7,200. The insurance company paid for $6,800 of it. Which one of the following is true?

Answer

1. Robert has to claim the $1,200 premium paid by his employer as income in 2011.

2. Robert must claim the $6,800 paid by the insurance company for the operation as income in 2011.

3. Robert must claim the $1,200 premium and the $6,800 insurance payment as income in 2011.

4. None of these events are taxable on his 2011 return.

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Answers (1)

Know the Answer?

Dante Kaufman · Answer 1

4) None of these events are taxable on his 2011 return.

Explanation:

When you get sick and your insurance company has to pay the bill it is not included in your gross income.

What you spend on health insurance is not considered income, even if your employer pays for it. You have to include your health insurance costs in your W-2 form, but it doesn't count as income.

If you itemize your deductions, you can include health care costs but only f they exceed 7.5% of your adjusted gross income.