Personal Finance (Not Investing) • Health Insurance Counting as Imputed Income

Hi everyone,

I am clinical fellow in medicine and my institution designates me as a "zero-salary employee", paid via stipend through a 1099-MISC. Very bizarre and archaic financial arrangement, but it is what I'm stuck with for the year. Anyways, I just received my 1099-MISC which was significantly higher than expected based off of my stipend earnings (10k higher for July-December). After reaching out to HR/Finance for clarification, this is apparently because health benefits for myself and my spouse are calculated as imputed income, and added to my 1099.

I am confused because it is my understanding according to current IRS publications (15b, 5137) that employer contributions to health plan benefits are excludable, and shouldn't count towards taxable income.

Am I missing something? Any suggestions?

For reference, at my marginal tax bracket this will result in an additional tax bill of about 4k if this imputed income is reported (for 6 months, so about 8k total for the one year fellowship).

Thanks in advance

Statistics: Posted by Jmc1260 — Tue Jan 30, 2024 5:49 pm — Replies 11 — Views 746

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