Making My Health Insurance Deductible

one man S-Corp shop

[walkman]

is that possible? I pay to private insurers. Basically, I was not singed up as walkman (not my real name ;)) from XXX Inc. Can I make it so the amount I pay (a nice chunk) is deducted a business expense? There's plenty of money left to pay taxes on...

[gopi]

If you are a C-corp i think you can deduct your health insurance and stuff!

[paybacksa]

you must speak to ann accountant. Your self-insured healthcare costs are deductable but there are many strict rules for how it is done, limits on deductions, etc.

yes, if you set up a corp health plan the costs can be born by the corp, and this will then be deductable by the corp, again provided very strict rules are met. The "health plan" can even be a plan to simply reimburse you for paying your own health costs. However, that may not be good for you depending on how you set up yourself and your costs earnings, etc...

lots of legal snafus, but a common question for the CPA.

[walkman]

yep. Probably needs to be made so in addition to the salary, I get health insurance from the corp too. I'm the hardest working guy here so I definitely desrve it ;)

[coopster]

Have you considered an HSA (Health Savings Accounts, an expansion of the Medical Savings Accounts concept)? Something else to look into...

[percentages]

[google.com...]

First true search result gives you the basics. Then you can go deep into the IRS code if you wish.

Basically since 2003 it should be 100% deductible (subject to your CPA agreeing of course) :)

[paybacksa]

Your accountant can advise you on whether Plan A (lower cost with copayments per office visit, for example) is actually better than Plan B (which may be more expensive, but without copayments) since the value of your deduction depends on your situation.

I started Plan A to keep coverage affordable and since I didn't have high taxes initially. I wasn't able to deduct the copays and only aportion of the deductable (there were alot of $20 copays when you have small children).

Now that my taxes are larger (earnings are greater) and the deductable % amount is higher, paying more for premiums is worth more for me, due to the value of the deduction.

It is wise to see an accountant in the beginning of the year, and again in the Fall, not just when taxes are due.

Spring planning (to make sure you do it right all year)
Fall planning (to make sure you adjust whatever needs adjusting before the calendar year ends)
and Tax Time to make sure you file everything correctly.

[vkaryl]

Voice of caution/reason:

ALL of this is totally dependent upon the laws of the country in which your company is incorp'd....

[Broadway]

I'm not an expert but I run a site through a s-corp (usa).

1st off, on the front side of your fed form 1040 there is a line for a deduction for health insurance premiums paid. This deduction is intended for those who are self employed. The advice someone else had about a Medical Savings Accout seems good advice too.

2nd, yes, with a c-corp health insurance costs paid for an employee can be an expense of the corporation.

With an s-corporation I belive if you own more than 2% of the shares of the corporation you will not be able to take advantage of your company claiming an expense for paying your health insurance costs.

[walkman]

"1st off, on the front side of your fed form 1040 there is a line for a deduction for health insurance premiums paid"
Damn, it says the policy has to be established under the business name. I'm still paying Cobra (from my last day job) and will continue with that company (Texas BCBS) since it's way cheaper than anything in NJ.