I'm employed by a company but have to pay for my own life and health insurance. Can I deduct the premiums?

Hi,

I work for a company that pays me fringe benefits in my check. What this means is that I have to pay for my own life and Health insurance.

Can I deduct the premiums when I file my taxes?

Thanks in advance for any help.

Yes, you may deduct the costs you pay for health insurance given that your total yearly expenses are greater than 7.5% of your adjusted gross income. (so if your AGI is $50,000 you must subtract $3,750 from your total medical expenses. Anything you pay over this amount may be deducted. If your total expenses are under 7.5% of your AGI, sadly you may not claim the deduction.)

However I suggest you set up a health savings account. They work much like an IRA, in that any funds you put into it are before tax. Any funds withdrawn to pay for medical expenses are not taxed. The funds you put in are investable and may earn you interest that is also tax free, given that it is used on medical expenses.

If you withdraw funds before age 65 not for health expenses there is a 10% penalty plus regular taxes (after 65% it would be taxed but no penality). So you may want to put in only a little more than what you anticipate your annual health expenses will be.

To qualify you also need to be in a high deductable health plan ($1,050 deductable for individual/ $2,100 for families) that also has an out of pocket expense cap of no greater than $5,250 indiv. ( $10,500 fam.)

Not be eligable for medicare

and not covered by any other health plan that is not a HDHP

The good thing about a HDHP is that you premiums will be lower than a plan with a low deductable.

If a HDHP does not appeal to you, there is another option to save your max tax dollars. As long as you or your spouse are both NOT eligible to participate in a employer health plan, 100% percent of your expenses paid for health insurance are tax deductable if you are also self employed. However your deduction may not exceed the amount of income you generate from the self employment.

Life insurance is not a deductable item. If you are self employed you may be able to deduct the cost of life insurance. You would need to actually start your own company (even a sole proprietorship). If the beneficiary on the plan is someone other than the tax payer (so a child perhaps. your spouse would not qualify if you file jointly) the cost is 100% deductable. Keep in mind, all expense deductions can not be greater than the amount generated by the business.

Thats a lot of work. I would just urge your employer to set up a group term life plan for employees. You would get the tax free fringe benefit, and they still get the tax deduction. It's silly for them not to not offer it.

Note: This information is all the options available to the asker of the question based on the info given that he has to buy his own insurance, and it is not available through his work. Answers above that mention his work deducting pay to go to a health plan do not apply, as he does not have this option.

If the insurance premiums are deducted from your paycheck, they may be deducted pretax or after tax. If they are deducted pretax, they will not be included in the taxable income and will not be deductible from on your tax return (in effect, they were deducted already). If they are after tax, they will be deductible as an itemized medical deduction, subject to the 7.5% limit used on Schedule A.

If you don;t know whether they are pretax or after tax, ask your HR or payroll department.

If you itemize deductions on Schedule A, you can include non-reimbursed amounts paid for health insurance as medical expenses subject to 7.5% of your adjusted gross income (AGI).

Life insurance premiums are not deductible.

No.

Anything that is paid as a fringe benefit is not going to be deductible on your tax return.

Are they deducting the premiums from your check? Or are they not deducting
the premiums but are contributing to the plans on your behalf (see box 14 of
your W-2).

If the premiums are reducing your weekly earnings, you can deduct the "health insurance" premiums on Schedule A (but only if you itemize).
"Life insurance" premiums are never deductible.

If they are contributing towards a life or medical insurance policy and there is no effect on you other than obtaining a fringe benefit from them, you have no
"economic" loss in this situation. It has cost you nothing, but you derived a benefit from it.

In that circumstance, there is no deduction to you.

Life insurance premiums are never deductible.

Health insurance premiums are almost always paid with pre-tax dollars. In this case, you've already received a full deduction for the premium and cannot therefore take a medical expense deduction. That's a better deal than taking a deduction as there is no 7.5% AGI limitation to deal with and you get the deduction whether you itemize or not.

If you work for one of the rare companies that pays health insurance premiums with tax paid dollars, you can take a medical expense deduction for the premiums you paid if you itemize deductions. This would be subject to the 7.5% AGI limitation.

If you file a 1040 and are able to itemize your deductions (on a Schedule A) then you can claim all medical expenses above 7.5% of your AGI. This includes premiums for health insurance. Life insurance premiums do not qualify.

Not life insurance. When you file taxes- add up ALL you have spent on medical care for your family. This includes premiums, copays, prescriptions, chiropractic, etc. If it totals a certain percent of your income (don't recall the exact percent) then you can claim whatever exceeds a certain figure (mine was whatever exceeded 5k). It doesn't always work out but once in a while if you have a large medical bill it might make your total high enough to claim. Just add up all the fees and give that figure to your accountant.

Absolutely!you are entitled to deduct any medical expenses that are not paid for by any other source but you.your visits to the doc.dentist, chiropractor and your medication.

yes is a medical expense

I have been self-employeed for (3) years and have paid and deducted my family insurance preminums on schedule c business expenses. I recently took a full time job while I continue to receive self-employment income. The new employer offers company subsidized healt insurance for me but does not contribute anything for spouses and children. They offer the plan for your spouse and children but do not contribute to the preminums. If I continue to buy insurance for my spouse and children outside my employer are those premiums still deductable?

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