What is a Self-employed health insurance deduction?
The self-employed health insurance deduction allows qualifying sole proprietors, partners, and S Corporation shareholders to deduct 100% of premiums paid for medical, dental, vision, and long-term care insurance for themselves, their spouses, and their dependents from gross income under Section 162(l). The deduction cannot exceed net self-employment profit and is calculated on a per-month basis. Eligibility ends for any month the taxpayer remains eligible for employer-sponsored health plan coverage. Coordination with a Health savings account maximizes healthcare tax savings each tax year.
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