Self-Employed Health Insurance Deduction Calculator
Calculate your self-employed health insurance deduction and see how much you can save on taxes
Keep your premium budgeting on track with BudgetBuddy, sync paycheck estimates inside PayWise, and double-check deduction amounts with TaxWiser before filing.
Health Insurance Deduction Calculator
Health Insurance Premiums
Your monthly premium for health insurance
Business & Tax Information
Your net business profit after expenses
Your marginal tax rate
Important: You can only deduct health insurance premiums up to your net self-employment income. If you have access to employer-sponsored insurance through a spouse, you may not be eligible for this deduction.
Your Health Insurance Deduction
Annual Premiums
$6,780
Deductible Amount
$6,780
Tax Savings
$2,010
Breakdown
Tax Impact
Disclaimer: This calculator is for educational purposes only. Eligibility for the self-employed health insurance deduction depends on various factors. Consult a tax professional for personalized advice.
How the Self-Employed Health Insurance Deduction Works
If you're self-employed, you may be able to deduct 100% of your health insurance premiums on your tax return. This is an "above-the-line" deduction that reduces your adjusted gross income (AGI).
What's Included?
- Health insurance premiums
- Dental insurance premiums
- Vision insurance premiums
- Long-term care insurance (subject to age-based limits)
- Medicare premiums (including Parts A, B, C, and D) if you're over 65
Eligibility Requirements
- You must have a net profit from self-employment
- You cannot be eligible for employer-sponsored insurance through your or your spouse's employer
- The insurance plan must be established under your business
- You cannot deduct more than your net self-employment income
Tax Benefits
The self-employed health insurance deduction provides two key tax benefits:
- Reduces Income Tax: The deduction lowers your adjusted gross income (AGI), which reduces your income tax liability based on your tax bracket.
- Reduces Self-Employment Tax: By lowering your AGI, it also reduces your self-employment tax liability by approximately 7.65% of the deduction amount.
This makes the total tax savings roughly equal to your marginal tax bracket plus 7.65% (half of the 15.3% self-employment tax rate).
Tips to Maximize Your Deduction
Keep detailed records: Save all premium payment receipts and proof of coverage throughout the year.
Include your family: You can deduct premiums for yourself, your spouse, and dependents.
Consider an HSA: If you have a high-deductible health plan, you can also contribute to a Health Savings Account for additional tax benefits.
Report on Form 1040: The deduction is claimed on Schedule 1 (Line 17) and reduces your AGI on Form 1040.