Help! Can someone answer some questions regarding W2's and FSA/401k deductions?

<p>I am working on the profile and I need to estimate what our AGI will be for 2008. That isn't going to be easy -- in 2007, hubby had two part-time jobs and was unemployed for a period of time. We had no health insurance, no FSA, no retirement savings.</p>

<p>2008 -- hubby is employed with health insurance, 401k and FSA. The situations are completely different, so looking back at last year's taxes won't help me.</p>

<p>So...when we get the W2 next January, will the amount that was contributed (pre-tax) to the 401k/FSA/Health Insurance premiums be included in box 1: Wages, tips, other comp? </p>

<p>I am trying to figure out our estimated AGI -- but I don't know if those amounts are included or not.</p>

<p>Thanks for any help!!!!</p>

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<p>Then you will use pay stubs you have up until now, and add in the amount of income for the remainder of the year.</p>

<p>Re: the retirement..I haven't done a Profile in a few years, but isn't there another line that asks for contributions made for retirement accounts (tax exempt ones)? I seem to think there is. You would fill in the amount contributed in 2008, and yes, that will be "added back in" as income for the 2008 year. But I don't believe YOU add that together.</p>

<p>I could be wrong...it's been a few years since I've done a Profile (thank goodness!!).</p>

<p>Don't know specifically about profile. The AGI on your tax return is the figure after 401k contributions/FSA are deducted. Health insurance premiums are usually after tax dollars so should not affect the AGI. For FAFSA the 401k contributions are added back as income on one of the schedules - I would guess that profile would be the same as I can't see them letting you reduce your income by 401k contributions. From reading previous threads on CC I think FSA contributions are not usually added back on FAFSA but do not know about CSS.</p>

<p>If you are not sure whether certain expenses are pre AGI you can check by looking at a 1040 form - this is the 2007 one - I can't find a 2008 one
<a href="http://www.irs.gov/pub/irs-pdf/f1040.pdf%5B/url%5D"&gt;http://www.irs.gov/pub/irs-pdf/f1040.pdf&lt;/a&gt;&lt;/p>

<p>As you can see line 37 is the AGI. Health Savings account contributions (which is the same as FSA I believe) are deducted on line 25 and IRA deductions are deducted on line 32 so the AGI is your income after these items are deducted. Generally only self employed health insurance contributions are deducted pre AGI.</p>

<p>On your W2 the wages/tips etc should show your gross pay before any deductions. You will have to work out your estimated AGI using gross income and deducting any 401k or FSA contributions. Use the 1040 form as a guide.</p>

<p>FSA is a flexible spending account and it is NOT the same as a HSA ..health savings account. First of all...for the Flex, you can use it for other things...such as dependent care, over the counter drugs, etc. This is not the case with the HSA. Flex cannot be carried over from one year to the next. HSA balances can (and are) carried over from year to year. </p>

<p>We had a Flex plan. It's a "use it or lose it" kind of plan. In other words, you put the money into the account and either you use it and get reimbursed for allowable expenses, or you lose the money. I do not believe it is added back income on either the FAFSA or the Profile.</p>

<p>Thumper - For the OPs question - Is the FSA deducted pre AGI like the HSA? I don't see a place on the 1040 to deduct anything of this sort other than for the the HSA.</p>

<p>Contributions to both the FSA and the 401K are added back into income for the Profile. The balance of the 401K is not considered as income.</p>

<p>The reason for this is that Profile considers that these contributions are "voluntary" so this is just as available as funds used for any other type of purchases.</p>

<p>FSA contributions are pre-tax; they're deducted from income up front, not on the tax forms. You reduce your actual taxable income that shows on the W-2 by the amount of the contribution. So if your pre-FSA income would be $50,000 and you put $5,000 in the FSA, your W-2 income is $45,000.</p>

<p>Just checked my W-2 forms and Chedva is correct...the FSA amount is included to be added back in.</p>

<p>Looks like I mis spoke about the W2s - sorry :(. It is a while since we had an FSA so I got the info wrong. Wish there was a way for a retiree to have an account where you can contribute pretax dollars for medical expenses. We have more expenses now that we did when my husband was working so using pre tax $$s would be nice.</p>

<p>Our 401K, Dental and health insurance, and flexible health account deductions all come out before federal taxes. So the federal Income box on W-2 has all those removed already, making the AGI lower. I don't remember adding the health insurance premiums back in on the financial aid forms, but they were definitely pre-tax.</p>

<p>We are allowed a max of $5000 in the flexible health account, which is already spent by July most years due to our high copays for dental, prescription, eye glasses, and health. I am grateful that we have it, but I wish we could put more in!</p>

<p>thanks to everyone for the help!!! </p>

<p>Mamabear -- your answer in particular helped! I know about the fact that some income that is pre-tax gets added back in, etc (not a big deal for us -- the amount is miniscule) but I couldn't figure out if it was already taken out of the W-2 figure or I needed to deduct it myself. I didn't want to have it count twice!</p>

<p>My husband's paycheck clearly states that all health/dental/vision premiums as well as the FSA are pre-tax (they are highlighted differently on each paycheck).</p>

<p>I love the FSA (and actually having health insurance for the first time in 5 years) -- what a great concept! I agree with swimcatsmom -- individuals should be able to do an FSA.</p>