I had a tax question brought up to me at work today and I wasn't aware of the answer, and I'm wondering if you had any insight on this topic.
For retirees at a certain company we work with, they are promised health insurance for life once they are retirees. Their new policy gives them a choice of Health insurance for life or an annual payment of 35% of the value of the health insurance payment for that year.
If they were only offered 1 option (health insurance for life), that would be non-taxable, but now since the policy lets you choose one between the other (health insurance or payments), would both of those options; whichever one you choose, be taxable to the Retiree? And if so, would a 1099 or W-2 be issued to them?
For retirees at a certain company we work with, they are promised health insurance for life once they are retirees. Their new policy gives them a choice of Health insurance for life or an annual payment of 35% of the value of the health insurance payment for that year.
If they were only offered 1 option (health insurance for life), that would be non-taxable, but now since the policy lets you choose one between the other (health insurance or payments), would both of those options; whichever one you choose, be taxable to the Retiree? And if so, would a 1099 or W-2 be issued to them?