Jump to content
ATX Community

SEHI deduction?


jklcpa

Recommended Posts

Wife has schedule C and 1095B is in husband's name.  Clearly, the policy isn't in the business name or wife's name but they are filing a joint return, premiums were paid from joint account, and policy covers the family.

Are they completely dead in the water for taking the SEHI?  I've seen some arguments for taking this deduction as SEHI in this situation where practitioners argue that IRS opened this can o' worms when it allowed the spouse's medicare premiums to be included in SEHI, and these same practitioners argue that a similar situation would occur with this policy since the coverage is "family" and extends to the self-employed wife.

What say you?

Link to comment
Share on other sites

Your first paragraph discussed health insurance. Your second paragraph introduces Medicare. Which is it?

To my knowledge - you can't take the Medicare premium as SEHI unless the person IS self-employed.

Is it possible in your state that the wife can employ the husband and have the health insurance paid through the business?

Link to comment
Share on other sites

It's a regular health insurance policy not medicare. As I said, practitioners on other forums are using the deductibility of the non-SE spouse's(or dependent's or child's) medicare as SEHI, and applying that to regular insurance premiums too. 

When I said that IRS opened a can of worms, it was item #3 from the memorandum below that was issued in 2012 that addressed the issue of whether a spouse's, dependent's, or child's medicare premiums could be included in with the self-employed person's premiums for purposes of calculating the SEHI deduction.  BTW, no need to point out that this memorandum says it shouldn't be relied on or cited as precedent, because for anyone who IS including the "others' " medicare for purpose of computing the SEHI, this is the memorandum they are relying on . . . and they are extending that logic to other health insurance too.  This was the reason a opened this discussion.

https://www.irs.gov/pub/irs-wd/1228037.pdf

 

Link to comment
Share on other sites

Publication 535, Business Expenses, page 20, seems to contradict the law (IRC 162 (I)(1)(A)) which simply states "specified premiums means premiums for a specified qualified health plan or plans for which the taxpayer may otherwise claim a deduction under section 162(l). For purposes of this paragraph (a)(2), a specified qualified health plan is a qualified health plan, as defined in § 1.36B-1(c), covering the taxpayer, the taxpayer's spouse, or a dependent of the taxpayer (enrolled family member) for a month that is a coverage month within the meaning of § 1.36B-3(c) for the enrolled family member. If a specified qualified health plan covers individuals other than enrolled family members, the specified premiums include only the portion of the premiums for the specified qualified health plan that is allocable to the enrolled family members under rules similar to § 1.36B-3(h), which provides rules for determining the amount under § 1.36B-3(d)(1) when two families are enrolled in the same qualified health plan..  The code does not specifically disallow insurance that is not in the name of the business or the self-employed person.

I would have no qualms taking the self employed health insurance deduction if the taxpayer otherwise qualified since the married couple tends to be one 'taxpayer' (joint and several liability, etc.) under the law.  Just my opinion.

 

Excuse the emphasis . . . that's what happens when you cut and paste from the IRC.

 

 

  • Like 2
  • Thanks 2
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
  • Recently Browsing   0 members

    • No registered users viewing this page.
×
×
  • Create New...