Today TaxMama hears from Dan in Massachusetts with this question. “The new COBRA premium assistance is phased out if the employee’s AGI is greater then $145K. It must be paid back when the employee files their taxes. How does the employee know what the premium assistance was?”
When the whole COBRA thing came into being, I was wondering things like that, too.
It turns out, that to get the benefit of the employer payment, you have to sign up directly with the former employer when you leave. And you are required to send your insurance checks directly to your employer to ensure all the premiums are covered.
As a result, you know exactly how much assistance you are getting.
Here is one Department of Labor Fact Sheet that helps explain the benefit: COBRA Premium Reduction
The Department of Labor has an FAQ page with 25 frequently asked questions, here:
Incidentally, for folks who were laid off before the law was passed, there was an opportunity to opt into this benefit after the fact. That’s explained in the first Fact Sheet, above.
And remember, you can find answers to all kinds of questions about COBRA repayments and other tax issues, free. Where? Where else? At TaxMama.com.[Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.]
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