Can you claim health insurance premiums on your taxes?

If you buy health insurance through the federal insurance marketplace or the state marketplace, any out-of-pocket premium is tax-deductible. If you are self-employed, you can deduct the amount you paid for health insurance and eligible long-term care insurance premiums directly from your income. Health insurance premiums are deductible from federal taxes, in some cases, because these monthly payments are classified as medical expenses. Usually, if you pay for health insurance on your own, you can deduct the amount from your taxes.

Your income and how you get your insurance help determine if costs are eligible for tax deductions. If you list your deductions for a taxable year in Schedule A (Form 1040), Itemized Deductions, you may be able to deduct the expenses you paid that year for medical and dental care for you, your spouse, and your dependents. You can only deduct the amount of your total medical expenses that exceeds 7.5% of your adjusted gross income. Calculate the amount you are allowed to deduct on Schedule A (Form 1040).

Health insurance premiums paid with your own money after tax are tax-deductible. For example, if you purchased insurance on your own through a health insurance marketplace or directly from an insurance company, the money you paid for your monthly premiums can be taken as a tax deduction. A long list of health-related expenses can be included in your total medical expenses, including prescription drugs and optional surgical procedures, such as laser eye surgery to correct vision. In addition, to deduct medical expenses, including health insurance, from your taxes, your total medical expenses must exceed 7.5% of your AGI and you can only deduct the amount greater than that 7.5%.

If you can claim your health insurance as a medical expense deduction, you can only deduct medical expenses if you itemize your deductions and they exceed 7.5% of your adjusted gross income. Even if you're not self-employed, the Internal Revenue Service (IRS) allows you to count medical and dental insurance premiums (and, with some limitations, long-term care insurance premiums) as part of the 7.5% of your adjusted gross income (AGI) that must be spent on health care before any out-of-pocket expenses are spent can deduct medical expenses.

Geneva Lattig
Geneva Lattig

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