rickb
New Member

I'm self employed, would non-ACA compliant health insurance be tax deductible? Obviously it would be subject to the non-ACA tax penalty regardless.

Here's why I am asking. I've been approached by non-ACA insurers that are suggesting I also take on an additional "faith based" insurance to get around paying the exemption, which appears to be "legal" if somewhat dubious. I know the faith based insurance wouldn't be tax deductible but what about the non-ACA insurance?

Get your taxes done using TurboTax

Yes, non-ACA compliant health insurance would still be deductible as a Medical Expense.

You would still be subject to the ACA penalty unless you qualify for an exemption. 

https://www.healthcare.gov/health-coverage-exemptions/forms-how-to-apply/

Personally, I think if you are going to spend money on insurance, it makes much more sense to have qualifying insurance.  The reason it doesn't qualify is because it is lacking in some important area.


If you are part of a Health Sharing Ministry, that will waive the penalty for not having health insurance, but it is not deductible at all on your tax return.

Personally, I don't see anything wrong with a Healthcare Sharing Ministry.  It's not even necessarily "faith based".  Although I don't know a lot about it, it just seems to be a different version of health insurance that doesn't have all of the red-tape, overhead costs and bloatware, so it is more affordable.


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rickb
New Member

Get your taxes done using TurboTax

So reading up a little bit on the ACA tax penalty, it looks like the IRS doesn't really have any way to enforce it except by taking any refund you're due? Which would be a total non issue since I never pay overpay. Of course this may be all a moot point in the near future anyway.