If you are self-employed and use a Schedule C, then you may ADD up ALL you medical expenses (chiropractic , dentist , optometry , health insurance premiums, any indemnity plans (AFLAC, Family Heritage, etc. premiums), your co-pays, deductibles, prescriptions drugs, and over the counter if you put the date and what it was specifically used for. EXAMPLE.
Say you have 4000/yr in premiums, your deductible was 7500, your co-pays were 20 per time. Your prescriptions were 750 and 175 in overthecounter meds. SO 4000 + 7500 + 200 in co-pays + 925 in prescription and overthecounter meds + 1800 in AFLAC + 20,000 dental bill + 600 in chiropractic bills = 35,025 ou now take what sales % tx bracket you're in + your state taxes % if any + 15.3% of SS taxes you owe since you're self employed. Say you live in AR
15% + 7.5% +15.3% = 37.8% x 35,025 =
13,239.45 IN TAX WRITE OFFS..If you use Schedule F - line 17 It's called an Association 105, it's legal, by the IRS since the 50's - ask your CPA
2007-04-13 12:04:12 · 5 answers · asked by Tracey C 1 in Business & Finance ➔ Taxes ➔ United States
I am a tax CPA and the only med exp we deduct on the Sch C is the health insurance premium, the rest goes on sched A. Maybe there is a loophole that my 15 co-workers and I have heard of.
2007-04-13 12:08:52 · answer #1 · answered by LC 2 · 2⤊ 0⤋
I do taxes for a CPA firm, and I have done taxes for over 30 yrs and I've never heard of this. All I know of is that you can take an adjustment for self employed health insurance paid.
2007-04-13 12:36:10 · answer #2 · answered by irongrama 6 · 0⤊ 0⤋
Guess again. That line is for insurance premiums for employees. If your CPA told you what you describe is allowable, you'd better think about getting a new CPA.
Is that an IRS auditor I see coming up your front walk ready to knock on your door?
2007-04-13 13:23:05 · answer #3 · answered by Judy 7 · 2⤊ 1⤋
I would suggest you pack up all your data and or paperwork and go in person to your nearest office of the Internal Revenue Service- Taxpayer Assistance Division. They will be able to answer any and all questions you might have pertaining to your taxes and they will be able to tell you what forms or booklets you need and all for FREEEEEE!!!!!!
2007-04-13 12:14:55 · answer #4 · answered by Anonymous · 0⤊ 1⤋
OMG, please no one listen to this person. That is incorrrect. Like that other person said, you can only deduct health insurance premiums.
2007-04-13 12:29:22 · answer #5 · answered by Lisa M 2 · 5⤊ 0⤋