Is your healthy insurance premium tax deductible? Is it better to do a group plan or individual plans?
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Answer:
I have been a tax accountant for 27 years. I do not have enough information to give you a reliable answer to your question. However, you should look into a relatively new tax development called the HRA or HSA. Your bank should be able to provide you with information as to how these plans work. They are very flexible and work only when people purchase high-deductible health plans. The HRA or HSA accounts are used to pay out-of-pocket medical expenses (but not the insurance premiums) such as your deductible or co-pays under the plan. They are like IRA accounts for your health. I like them a lot. Please don't be a fool; consult a tax professional. You are in a very complicated area of tax law.
Healthy insurance premiums would generally be deductible however your question can not be answered with any degree of accuracy without knowing how the company is formed.
Not really looking at tax deductibility I think that a group plan is better, you are usually able to get better rates and the insurance companies cannot cancel your insurance as easily.
When you say you have a small company, I am assuming you are a sole-proprietor, LLC, S-corporation or similar pass through tax entity. In this case, the company can decuct the premiums for the employees, but not for you as the owner. You should include the premium for yourself on either the W-2 or K-1 that the company gives you. However, you will then be able to decuct it on page 1, line 29 of your individual 1040.
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http://insurancess.notlong.com
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