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Tax Talk: Writing off self-employment health insurance |
 | | If you were self-employed and had a net profit for the year, you may be able to deduct, as an adjustment to income, up to 100 percent of the amount paid for medical and qualified long-term care insurance on behalf of yourself, your spouse and dependents. |
 | | The insurance plan must be established under your trade or business, and you cannot take this deduction to the extent that the amount of the deduction is more than your earned income from that trade or business. |
 | | For example, if you earned $5,000 from your part-time sole proprietorship and paid $6,000 in health insurance premiums, your deduction is limited to $5,000 less the deduction on line 28 of Form 1040 for half your self-employment tax and less any SEP contribution related to the business. |
| www.bankrate.com /brm/itax/tax_adviser/20040225a1.asp (329 words) |
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