Are Medicare premiums tax-deductible?
Whether you can deduct your Medicare costs depends on your situation.
Medicare Part A premiums are a deductible medical expense if you voluntarily enrolled and aren’t covered under Social Security or aren’t a government employee covered by Medicare.
Medicare Part B, C, and D premiums also may be deductible.
Can I deduct my Medicare premium if I’m self-employed?
Yes, you can deduct Medicare premiums if you’re self-employed. Medicare premiums count as deductible health insurance premiums under the self-employed health insurance deduction.
However, you can’t take a deduction for any month you were eligible to participate in an employer-subsidized health plan (through your own employer or a spouse’s employer).
How much of my Medicare premium can I write off?
It depends on your tax situation.
If you aren’t self-employed, you can only deduct Medicare premiums if you itemize your deductions on Schedule A. However, only the portion that exceeds 7.5% of your adjusted gross income (AGI) is deductible. For example, if your AGI is $50,000, the first $3,750 in medical expenses aren’t deductible. Only premiums above that threshold are deductible.
If you aren't self-employed and take the Standard Deduction, your premiums aren’t deductible.
If you’re self-employed and have sufficient net income from this activity, you can deduct 100% of your Medicare premiums as an adjustment to income on your return. You don’t have to itemize your deductions and the 7.5% floor doesn’t apply.
Do I have to meet the 7.5% AGI floor for medical expenses to deduct Medicare premiums if I’m self-employed?
No, this requirement doesn’t apply to you if you’re self-employed. If you’re self-employed, you can deduct all of your Medicare premiums as long as you have a net profit.
How do I report Medicare premiums on my tax return?
How you report your Medicare premiums in TurboTax varies based on a few factors, but entering them in the right section matters, because it determines how your deduction is calculated.
If you receive Social Security or Railroad Retirement Board (RRB) benefits, you can enter Medicare premiums in the Social Security (SSA-1099, RRB-1099) section under Income in the Federal section. TurboTax will automatically pull the figure entered from your SSA-1099 or RRB-1099 to calculate your medical expense deduction on Schedule A.
If you’re self-employed, you can enter Medicare premiums as an expense. TurboTax will apply the self-employed health insurance deduction, which lets you deduct 100% of your premiums without itemizing, but only if the deduction for health insurance premiums doesn’t exceed the net profit from your business. Essentially, this deduction can’t put your business into a loss position.
If you paid Medicare premiums from an HSA, you can’t deduct them on your return since premiums were paid with tax-free funds.
If none of the above apply to you, add your Medicare premiums in the Medical Expenses section under Deductions & credits in the Federal section. TurboTax will include them with your other medical expenses and calculate how much, if any, exceeds the 7.5% AGI threshold for the Schedule A deduction.
