10-99 health insurance premium deduction question

[EMSDOC]

Hi, i have been reading on this site for the past year and have used it to revamp my retirement and tax planning. this is my first question where I was unable to locate the answer on an existing thread. I apologize if I missed it.

I am an attending EM/EMS physician with 2 jobs - my primary position is W-2 income and my second smaller income stream is 10-99 from a combination of legal work and per diem moonlighting ED shifts.  My question is: can I deduct my health insurance premiums and copays from my W-2job on schedule C for my 10-99 income?

Thanks for any advice

[Cuzz35]

Your health insurance premiums from your W-2 job will reduce your taxable wages on your W-2. I'm assuming the insurance is provided through your employer. If not the answer is different.

Out of pocket medical costs can only be deducted as medical expenses which are reported on schedule A.

If you have a HDHP you can contribute to, then you can use those funds to pay for medical costs which essentially allows you to deduct your medical expenses as an above the line deduction. This is because contributions to HSA's (health savings account) are deduction up to a set limit.

Hope this helps some.

[jfoxcpacfp]

You cannot take the deduction if you had group coverage from your or your spouse's employer. You can deduct co-pays only as part of your medical expenses on Schedule A (itemized deductions), subject to other limitations.

Cuzz35 wrote:

Your health insurance premiums from your W-2 job will reduce your taxable wages on your W-2.

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This is not true. Employer-paid premiums are not included in W2 wages. Premiums you pay will not reduce your W2 wages unless they are through a section 125 cafeteria plan. If not, you will have to deduct them on schedule A (if you have enough other medical expenses). It is rare that a full-time physician will qualify to deduct medical expenses on schedule A.

If you own your own business and secure medical insurance separate from a group plan through another employer, you can deduct the premiums as SEHI (Self Employed Health Insurance). If you are a > 2% owner of an S-corp, you can deduct your premiums in a roundabout way, which I will not go into as I don't think it is applicable to your situation.

[spiritrider]

The answer is no.

2017 Form 1040 Instructions, Line 29 Self-Employed Health Insurance Deduction, page 32

But if you also were eligible to participate in any subsidized health plan maintained by your or your spouse's employer for any month or part of a month in 2017, amounts paid for health insurance coverage for that month can't be used to figure the deduction.

[DMFA]

spiritrider wrote:

The answer is no.

2017 Form 1040 Instructions, Line 29 Self-Employed Health Insurance Deduction, page 32

But if you also were eligible to participate in any subsidized health plan maintained by your or your spouse’s employer for any month or part of a month in 2017, amounts paid for health insurance coverage for that month can’t be used to figure the deduction.

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I love RTFM posts :-)

[Cuzz35]

I should have wrote "health insurance premiums YOU PAY that are deducted from your W-2 wages you receive will USUALLY reduce your wages reported on your W-2."

I wouldn't expect anyone to think of deducting premiums their employer pays so I did not add that distinction in my response.

I don't really see where my response was wrong.

To simplify things a bit.

If you have employer "provided" health insurance and you pay the premiums, chances are your taxablesnwages will be reduced by premiums withheld from your pay.

If the same above except your employer pays all your premiums, then you can't deduct them.

If you pay for insurance out of pocket for insurance not provided by your employer, where you can deduct depends on whether your employer offers health insurance to you. Then there are income limits after that to determine whether you will receive any benefit from claiming a deduction. Others have explained this well already.