Qualifying insurance for self employed health insurance deduction

Forum|Forum|2 years ago
August 10, 2023
1 reply
14 views

Client is retired public safety officer who pays 100% of their health insurance premiums out of their pension check monthly. Client has a profitable schedule C. The health insurance plan is not subsidized. Are these premiums eligible for the Self employed health adjustment/

Lacerte Tax

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qbteachmt

Level 15

An amount excluded under the "pso" provision is not also deductible as a medical expense for itemized deductions and is not includible as health insurance for the self-employed heath insurance deduction.

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BobKamman

Level 15

Yes, but I think the question is about the excess above $3,000. I don't think it qualifies, but I also doubt that it is not subsidized. Would help to know what state (or local government) this involves.

qbteachmt

Level 15

"Yes, but I think the question is about the excess above $3,000. I don't think it qualifies,"

It's the opposite.

The $3k isn't reportable as taxable under the pso provision; it already got a tax benefit by exclusion. You cannot also use that for another deduction or take another credit for something that already got excluded from being reported and from being taxed.

Or, as a long-time and long-gone member of this group put it: You cannot write off what you never wrote on.

The rest should qualify up to the taxable business income. Any subsidy would reduce what the taxpayer had to pay, and that reduces what they can deduct, the same as ACA.

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