health insurance

Self-employed individuals may deduct health insurance premiums for themselves, their spouses, dependents, and children under age 27 as an 'above-the-line' deduction on their tax return, reducing their adjusted gross income. This deduction is available if the taxpayer is not eligible to participate in a subsidized health plan maintained by any employer of the taxpayer or their spouse. The deduction is limited to the net profit from the business, meaning you cannot deduct more than your business income. Additionally, premiums paid for long-term care insurance are subject to age-based limits. Employees may deduct health insurance premiums as an itemized deduction on Schedule A, subject to the 7.5% of AGI floor for medical expenses.