 |
Impact of Domestic Partnerships on Tax$ave
Beginning July 10, 2004, state employees were able to add a domestic partner to their health and dental insurance coverage. The domestic partner must be able to qualify as a "tax dependent" of the employee for federal tax filing purposes — under Internal Revenue Code Section 152 — before any premiums that the employee pays for the domestic partner coverage can be made on a pre-tax basis under the Tax$ave Premium Option Plan. Similarly, the domestic partner must qualify as the employee's tax dependent before an out-of-pocket medical expense incurred by the domestic partner can be reimbursed under the Unreimbursed Medical Spending Account. See IRS Tax Topic 354 — Dependents for additional information on the requirements for establishing dependent status for federal tax purposes.
If the domestic partner is not a "qualified tax dependent" of the employee, any premium deductions made for the domestic partner's coverage must be made on an after-tax basis, and funds in the Unreimbursed Medical Spending Account cannot be used to cover the domestic partner's medical expenses.
Additional information about the recently enacted New Jersey Domestic Partnership Act can be found in Fact Sheet #71, Benefits Under the Domestic Partnership Act, which is available on the Division of Pensions and Benefits Web site: www.state.nj.us/treasury/pensions.
|
