Why is health insurance paid directly by the st of conn to Blue Cross considered taxable income? retirement pkg- also includes 53.94 pay per month- isnt that the tax amt?

Depends. Retired public safety officers may elect to exclude from income a portion of their distributions made from an eligible retirement plan to pay for premiums for accident, health, or long-term care insurance.

Distributions must be from an eligible plan, which includes any of the following:

• Qualified trust
• Section 403(a) plan
• Section 403(b) annuity, or
• Section 457(b) plan

A public safety officer includes law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew.

The qualified health insurance premiums must be paid directly to the insurer. The insurance premiums can be used for you, your spouse, or your dependents. The total exclusion cannot exceed $3,000. The premium amount is not included in income and is not subject to the early distribution penalty.  If you don't qualify under this exclusion, then the amounts paid on your behalf would be taxable income to you.