IRS Deductions Question:(Nevada) If I carry my family on my Medical Benefits?

Question

This cost me about $500.00 a month. Plus, even though I am Married I withhold at a higher rate, so I have about $45.00 more taken out of My check per week because I don't want to end up owing the IRS some huge amount of money. I mean, let's face it geting a check from the government is a heck of a lot better than sending one.

Someone told me that, because I carry my husband and my 2 children as Dependants I may not need to have so much withheld at a higher rate & I wouldn't owe.

Does anyone out there know for sure?

Answer 1

The amount you pay for your medical will not be included in your taxable income.

The only way to know for sure, is to do a "mock up" tax return.  Go ahead and use a 2007 form - it'll be close enough.  Your tax will depend on your income, and deductions, and exemptions.  Then you compare your tax at the end to your total tax withheld for the year (You may have to estimate your income and tax withheld).

Then you'll know the outcome.  Without knowing all those things (total taxable income, deductions, plus things like mortgage, childcare credits, etc, and total tax withheld.), it's impossible for any of us to answer that question.

If you don't prepare your own returns, take what information you have to whoever does it, and get an estimate.

Answer 2

First of all, your husband is not your dependent.  A spouse is never a dependent.  Carrying him on your insurance is fine, but that has nothing to do with being a dependent, or on what you need to have withheld for federal income taxes.  It's pretty unlikely even if you itemized that you'd get any deduction for the medical expenses, including the insurance premiums if they're taken out post-tax..  If the premiums are taken out pretax, then you are already not having taxes deducted for that much of your income.

Ignore the person who is telling you about your taxes - they are confusing your tax return with your medical benefits, and they are unrelated.

With a joint return, and income that high, you'll need to be very careful of what you put on your W-4 since the withholding tables sometimes don't take out enough if you just follow the worksheets.  If you got a large refund last year, and nothing much changed about your income and other things to do with taxes, then you might be able to have less taken out, but if you didn't get a refund or it was only a few hundred dollars, then leave it alone.