Hello! My spouse recently left a non-profit organization and received COBRA reimbursements for the next few months as part of their severance package. We paid the first month out of pocket and submitted the required documentation to HR for reimbursement. The reimbursement was paid out on the following payday, however we were a bit confused about it not being the full amount and instead taxed as supplemental income. From everything I’ve read online, COBRA reimbursements requiring documentation are not supposed to be categorized as taxable income. While we are grateful for the partial reimbursement, it also leaves us several hundred dollars short of the monthly premium going forward which is a bit troublesome for our budget. We’re not committed to our network and have minimal medical expenses so we’re wondering if a) it’s legal for the reimbursement to be categorized as taxable income and b) if it might be better for us to just do a state plan until my spouse gets another job since it will cost less than what we’d have to pay out of pocket for COBRA otherwise. Any help would be greatly appreciated! Thank you so much!
submitted by /u/CuriousMind2013
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Hello! My spouse recently left a non-profit organization and received COBRA reimbursements for the next few months as part of their severance package. We paid the first month out of pocket and submitted the required documentation to HR for reimbursement. The reimbursement was paid out on the following payday, however we were a bit confused about it not being the full amount and instead taxed as supplemental income. From everything I’ve read online, COBRA reimbursements requiring documentation are not supposed to be categorized as taxable income. While we are grateful for the partial reimbursement, it also leaves us several hundred dollars short of the monthly premium going forward which is a bit troublesome for our budget. We’re not committed to our network and have minimal medical expenses so we’re wondering if a) it’s legal for the reimbursement to be categorized as taxable income and b) if it might be better for us to just do a state plan until my spouse gets another job since it will cost less than what we’d have to pay out of pocket for COBRA otherwise. Any help would be greatly appreciated! Thank you so much!
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