topic Self Employed Health Insurance Deduction, not working in Turbo Tax in Deductions & credits

Self Employed Health Insurance Deduction, not working in Turbo Tax

abbeyandjon — Mon, 19 Aug 2019 22:05:41 GMT

Hi,

I have Turbo Tax Home and Business.

I am self employed, I have a net profit, and I have health insurance premiums for me and my family.

I have entered it under Business Income & Expenses, Other Common Business Expenses, Insurance Premiums, Health Insurance Premiums.

After I entered it and hit continue, it shows the total amount I entered, but it doesn't change the overall total expenses line or the net profit line.

For example if the premium was $1000 a month, the total would be $12,000.

Say my expenses total $4000 before the premiums -- once entered and saved, it should bring my total expenses to $16,000 correct?

If the self employment income was $50,000, the expenses lower the net profit to $34,000 right?

When I enter it on Turbo Tax, the amount of the insurance premium did not change the total of the expenses and therefor did not impact the net profit for some reason.

Is there something I am doing wrong? Or am I misunderstanding something? Or is Turbo Tax not calculating this correctly?

Thanks in advance for any help and insight.

Re: Self Employed Health Insurance Deduction, not working in Turbo Tax

DoninGA — Mon, 19 Aug 2019 22:20:27 GMT

Self-employed health insurance premiums paid are not an expense deducted from your self-employment income. The premiums paid are an Adjustment to Income reported on Form 1040 Schedule 1 Line 29. The totals from Schedule 1 are subtracted from Form 1040 Line 6 and entered on Form 1040 Line 7 as your Adjusted Gross Income.

Re: Self Employed Health Insurance Deduction, not working in Turbo Tax

abbeyandjon — Mon, 19 Aug 2019 22:39:47 GMT

This is where Turbo Tax "help" section directed me to input this information. I read a few other posts on turbo tax forums that indicated that as well.

Do you know what the difference between the two sections are? I'm trying to understand why this section exists under Other Common Expenses?

Thanks for your help, I will try your recommendation.

Re: Self Employed Health Insurance Deduction, not working in Turbo Tax

abbeyandjon — Mon, 19 Aug 2019 22:49:56 GMT

I see what you are saying. That section of Turbo Tax does input it on 1040 line 9. It seems like it's really not impacting the total taxes owed that much so I will have to look into it further to better understand.

Thanks for your insight.

Re: Self Employed Health Insurance Deduction, not working in Turbo Tax

DoninGA — Mon, 19 Aug 2019 22:59:56 GMT

It will reduce your gross income on your return thereby reducing your federal income tax liability.

However, the health insurance premiums do not reduce your self-employment income, the Self Employment Taxes are based on your Net SE income.