Why are insurance premiums tax deductible for businesses but not for individuals?

Answer 1

Ah, the glory of a corporation. Corporations pay tax on their NET income, that is, income before ALL expenses. So not only are insurance premiums deductible, but plane tickets are, too. Oh, and office supplies.

Individuals pay tax on their GROSS income.

That's why really, really wealthy people don't really OWN anything themselves - they own CORPORATIONS that own the stuff that they use - their houses, cars, vacation homes, planes, jewelry, etc. They're SMART, and know how to use the tax laws to their advantage.

Answer 2

Tax breaks for businesses are intended to help spur growth and the development of their business. The same works for individuals who are self-employed. Normally, you can write off medical expenses only when they exceed 7.5% of your income. If you are self-employed, however, you can deduct up to 100% of your medical expenses, including health insurance premiums. The cost of health insurance is one of the most financially crippling aspects of a small business budget – that’s why many businesses do not offer employee health insurance at all. The fact that businesses don’t have to pay taxes makes it easier for many Americans to afford health insurance.

However, the insurance market is in flux; fewer businesses are offering employee health insurance, so the burden of paying for health care is increasingly on the individual. With so many Americans unable to afford health insurance, tax write-offs might be something to encourage people to pay for health care coverage.

Barnes@MostChoice

http://www.mostchoice.com/health-insurance.cfm
(compare health plans quickly and speak to local insurance experts without cost or obligation)

Answer 3

Well, for one thing, when you own a business and insurance is required, that is an expense. Many expenses are tax deductible when you own a business. For personal policies, it is the necessary evil, but not a business expense.

Answer 4

The tax code is used to incent businesses to create jobs.

The theory is that if you entice enough businesses with tax breaks, the businesses will do better and grow, thus hiring more people and generating more wealth. Growing businesses will pay more in taxes, thus sort of paying back the tax breaks.

The law treats businesses much differently than individuals.

Answer 5

i dont know