Deduction of nonsubsidized portion of marketplace premiums where employer does not sponsor.

[Michael12600]

How do I deduct the portion of my marketplace insurance premiums that I am responsible for (i.e., the portion not paid for by the subsidy) when my employer does not sponsor health insurance?  Seems to be that I should be able to do that since it would simply put me in the same position as an employee whose premiums are entirely pre-tax.

[MinhT1]

Your Marketplace premiums paid out of pocket are deductible as Medical expenses if you itemize deductions.

You can claim all medical and dental bills, prescription drugs and health insurance premiums paid out-of-pocket as Medical Expenses in Schedule A - Itemized Deductions

For tax year 2023, Medical Expenses are subject to the 7.5% rule and you can only claim the excess over 7.5% of your Adjusted Gross Income.

Please note that Itemized Deductions will only benefit your taxes when they exceed your standard deduction.

For tax year 2023, standard deductions are:

• $27,700 for married couples whose filing status is “married filing jointly” and surviving spouses;
• $13,850 for singles and married couples whose filing status is “married filing separately”; and
• $20,800 for taxpayers whose filing status is “head of household.”

The additional standard deduction for a blind taxpayer—i.e. a taxpayer whose vision is less than 20/200— and for a taxpayer who is age 65 or older at the end of the year is for each instance:

• $1,500 for married individuals; and
• $1,850 for singles and heads of household.

You can enter Medical expenses by following these steps:

1. In TurboTax, open your tax return
2. Click on the down arrow on the right of Federal in the left-hand column, then on Deductions & Credits
3. Continue and locate the section Medical and click on the down arrow on the right 
4. Click Start next to Medical Expenses.

[Michael12600]

Thanks for the quick reply.  I have read that these could be taken as an itemized deduction, but hoped that there is a way to take them as an above the line deduction without needing to itemize (and meet the 7.5 threshold).  Any other result means that an employee who is not enrolled in a plan that is sponsored by their employer (where the employee's contribution is all tax-free) is placed at a disadvantage when compared to an employee who participates in an employer-sponsored plan.  

[MinhT1]

You are correct.

This is the only way to claim health insurance premiums if you are an employee not covered by your employer's health policy.