My husband's health insurance costs missing from his W2 Box 12 - how to handle for taxes?
Title: My husband's health insurance costs missing from his W2 Box 12 - how to handle for taxes? 1 I'm a bit confused about how health insurance should be showing up on our taxes. Looking at my husband's W2, I noticed that box 12 is completely empty, including code DD which I think is supposed to show health insurance costs. Is this normal? His company is pretty small (maybe around 100 employees). Is there some rule that smaller companies don't have to include this information? Also, I'm trying to figure out if our health insurance premiums are deductible. We paid $6,794.38 out of pocket for premiums in 2024, and his employer covered $12,603.23 (about 65% of the total). If I'm doing the math right, our premium costs are more than 10% of our annual income. Should I be adding these premium costs somewhere on our tax return? I've been using FreeTaxUSA and saw something about medical expenses but wasn't sure if our health insurance premiums qualify or where to enter them. Any help would be appreciated!
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Cameron Black
17 You've got a couple different things going on here that I can help clarify. First, regarding the W-2 Box 12 Code DD - this is only required for employers with 250+ employees. Since your husband's company is smaller (around 100 employees), they aren't required to report the cost of employer-sponsored health coverage in Box 12 with Code DD. So that's not an error - it's completely normal for smaller employers. For your second question about deducting health insurance premiums - these can potentially be deductible as part of your medical expenses, but there are some important limitations. Medical expenses (including health insurance premiums that you paid with after-tax dollars) are only deductible if you itemize deductions on Schedule A, AND only to the extent that your total medical expenses exceed 7.5% of your adjusted gross income (AGI). If you take the standard deduction (which most people do), you won't be able to deduct these expenses. Even if you do itemize, you can only deduct the amount that exceeds the 7.5% threshold.
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Cameron Black
•6 Thank you for explaining! I'm still a little confused though. We do plan to itemize this year because of our mortgage interest. So if our AGI is around $65,000, we'd need medical expenses over $4,875 before we could start deducting anything? And the premiums we paid with after-tax dollars would count toward that threshold?
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Cameron Black
•17 That's exactly right! With an AGI of $65,000, your 7.5% threshold would be $4,875. Any qualified medical expenses (including those after-tax health insurance premiums) that exceed that amount could be deductible. For example, if your total qualified medical expenses for the year were $6,794.38, you could potentially deduct $1,919.38 ($6,794.38 - $4,875). Just make sure you're only counting premiums paid with after-tax dollars - any portion paid through a cafeteria plan or other pre-tax arrangement wouldn't qualify because they're already tax-advantaged.
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Cameron Black
9 After dealing with confusing health insurance reporting on my taxes last year, I found this amazing tool called taxr.ai (https://taxr.ai) that helped me sort everything out! My situation was similar - my W-2 didn't have the health insurance costs listed, and I wasn't sure how to handle the deductions. The tool analyzed my tax documents and explained exactly what I needed to do about my health insurance premiums. It immediately clarified which portions were deductible and which weren't. Plus it helped me identify some medical expense deductions I would have completely missed.
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Cameron Black
•3 Does this work with documents from previous tax years? I think I might have missed some health insurance deductions on my 2023 return and wondering if it's worth filing an amendment.
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Cameron Black
•22 I've seen a lot of these tax tools, but how is this any different than just using regular tax software? Can it actually find more deductions than something like TurboTax or FreeTaxUSA?
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Cameron Black
•9 Yes, it absolutely works with documents from previous years! I actually used it to find some missed deductions from 2023 and ended up filing an amended return that got me an additional refund. As for how it's different from regular tax software, the big difference is that it actually analyzes your documents and identifies specific items you might miss. Regular tax software asks you questions but doesn't actually "read" your forms to spot issues. For example, it caught that my employer had incorrectly coded some health benefits, which regular software wouldn't have flagged because it just accepts what you input.
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Cameron Black
22 Just wanted to follow up on my skepticism about taxr.ai from above - I decided to give it a try with my W-2s and healthcare documents and I'm genuinely impressed. The tool found that I'd been missing deductions for some specialty care coverage I'd been paying for that wasn't run through my employer's main plan. Just amended my 2023 return and expecting about $840 back! The analysis was way more detailed than what I got using regular tax software. It actually explained WHY certain premiums were deductible while others weren't, instead of just asking me to input numbers.
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Cameron Black
11 If you're trying to get clarity on whether your employer made a mistake with your W-2 reporting, good luck trying to reach the IRS directly! I spent WEEKS trying to get through on the phone to ask about a similar health insurance reporting issue. Finally found Claimyr (https://claimyr.com) and they got me connected to an actual IRS representative in about 20 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed exactly what I needed to know about my health insurance reporting requirements and whether my employer had made an error. Turns out mine HAD made a mistake, and I was able to request a corrected W-2.
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Cameron Black
•14 Wait, how does this actually work? Do they just call the IRS for you? Couldn't I just do that myself?
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Cameron Black
•22 Sorry, but this sounds like BS. I've tried everything to get through to the IRS and nothing works. How could some service magically get you through when millions of people can't get through?
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Cameron Black
•11 They don't call for you - they use some technology to navigate the IRS phone tree and hold in line for you. When they reach a representative, you get a call to connect directly with the IRS agent. The reason it works when doing it yourself doesn't is that they have systems that can stay on hold for hours and navigate through all the menu options correctly. It's not magic - just technology that handles the most frustrating part of reaching the IRS. You still talk directly to the IRS yourself, they just handle the getting-through part.
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Cameron Black
22 Just want to publicly eat my words about Claimyr from my skeptical comment above. After waiting on hold with the IRS for 3+ hours across two different days (and getting disconnected both times), I tried the service out of desperation. Got connected to an IRS agent in 25 minutes. The agent confirmed that companies under 250 employees don't have to report health insurance costs in Box 12 with code DD, but they did recommend I request documentation from HR about our premium payments for my records. Just having a definitive answer saved me hours of research and worry.
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Cameron Black
7 Just to add some clarity from someone who works in HR - the 250+ employee threshold for reporting employer health costs on W-2s (Box 12, Code DD) is definitely correct. Something else to consider: if your husband's premiums are being deducted pre-tax through a Section 125 Cafeteria Plan (which is common), those premiums are already tax-advantaged and wouldn't be eligible for additional deduction on your return.
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Cameron Black
•3 If the premiums are deducted pre-tax, would they show up somewhere else on the W-2? How can I tell if they were pre-tax or after-tax deductions?
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Cameron Black
•7 Pre-tax premium contributions would typically reduce the wages reported in Box 1 (Wages, tips, other compensation) on the W-2. They generally don't appear as a separate line item. The easiest way to confirm is to check your husband's pay stubs. If the health insurance premiums are deducted before taxes are calculated, they're pre-tax. You might see language like "Section 125" or "Cafeteria Plan" or simply "Pre-tax" next to the deduction. Alternatively, you can ask your husband's HR department - they can tell you definitively whether the premiums are being deducted pre-tax.
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Cameron Black
18 Does anyone know if dental and vision insurance premiums count toward the medical expense deduction too? My W-2 doesn't break anything out either.
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Cameron Black
•5 Yes, dental and vision premiums count as medical expenses for deduction purposes! I itemized last year and was able to include them. Just like regular health insurance, they need to be paid with after-tax dollars to be deductible.
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