Health Insurance Expenses for Self-Employed

[LaughTrack]

I am self-employed and want to report all my family's health insurance costs on Form 1040.   One family member's expenses, however, were bought on the Obamacare site, and Turbo Tax is telling me I must report those expenses on Schedule A, which prevents me from deducting them on Form 1040.   An article from you, linked here:  https://turbotax.intuit.com/tax-tips/home-ownership/deducting-health-insurance-premiums-if-youre-sel...  suggests I can deduct them, but the program specifically says I cannot and must enter them on Schedule A (where I don't think I will have sufficient expenses to justify a deduction.)  Which is it?  What should I do?

[SusanY1]

In TurboTax, you do need to enter the Form 1095-A in order to reconcile any tax credits for the ACA plan.

Once that information is entered, TurboTax will take the net premiums (premium less the credits or subsidies, if any) and move them to your Schedule C when you check the box "I'm self-employed and bought a Marketplace plan." 

Even though the question says I and you indicate this is a family member, please check this box to transfer the data properly - this is a TurboTax question not something that directly ends up on your tax return - we are just telling TurboTax what to do with the information here.  

That screen looks like this, and it is after you have entered all of the 1095-A data in the Health Insurance section of the program: 

[LaughTrack]

Thanks, I finally found the right box to check, but, as it turns out, this expense, per your program, is NOT deductible even though my other health insurance expenses are against my self-employment income.   Seems weird, but maybe that's just it.

[VolvoGirl]

Self-employed health insurance deduction goes on Form 1040 Schedule 1 line 16 then to 1040 line 8a, as long as the expense is not greater than your net self-employment income. If it does exceed your net self-employment income it gets split automatically. An amount equal to your net self-employment income goes on Form 1040 Schedule 1 line 16, and the remainder gets added in to medical expenses on Schedule A.

[LaughTrack]

Thanks, but the amount entered on form 1095-A is not showing up on Form 1040 Schedule 1 line 16 and it is less than my net self-employment income.   That amount is showing up on Schedule A, where it doesn't do me any good.  Is this a flaw in the program, or am I not doing something right?

[LaughTrack]

I did as you instructed, but the costs on the 1095-A are still showing up on Schedule A.

Help!

[VolvoGirl]

Do you have enough Net Profit on Schedule C to cover the insurance?

[bnse]

Hi!  I have started entering info for 2020, and I am coming across the same issue.  My health insurance expenses are not being deducted even though I checked the box that I am self-employed.  Did you ever get a solution?

[Critter-3]

Turbotax 2020  is an  incomplete program and it will not be fully operational until sometime in January or February for some things like states.   The program will undergo weekly updates as they complete sections ... this happens every year without exception.  

ANY tax software released by any company prior to about January 15 is only released for marketing and market share.  No program is complete and ready to file until the IRS approves their final forms and then individually reviews each program's implementation of the form.  And some tax situations aren't able to be filed until February or March, again mostly due to IRS delays.

Now, it would be better if the updates that were easy to do were done in advance.  But that may not fit the program workflow.  For example, if the MAGI calculation is part of the module or subroutine for form 8606, the programmers may decide not to update any part of the 8606 subroutine until the actual form and instructions for 2020 are released by the IRS and then reprogram the entire module all at once.  

When will my forms be ready?

Historically, IRS tax forms start becoming available in January, with a few stragglers (most notably Form 1040X) getting finalized in February.

State tax forms can become available for filing any time between December and late February, depending on the state and the tax form.

For specific forms and dates, refer to the Forms Availability Table for your TurboTax product, see the related information below.

Can I Still Work On My Return Before My Forms are Ready?

Yes, according to the following:

Federal Taxes
You can still work on your return and finish most of it. Once your forms become available, we’ll create the forms and include all of your info.

You’ll only be able to e-file or print your return once the forms are available.

While you’re working on your return, we’ll ask if you want to receive email updates when your forms become available.

State Taxes 
If your forms aren’t available, you’ll get a message asking you to return once they become available.

While you’re working on your return, you’ll have a chance to let us know you want to receive email updates when your forms become available.

Related Information:

           IRS Forms Availability Table for TurboTax Individual (Personal) Tax Products

·         State Forms Availability Table for TurboTax Individual (Personal) Tax Products

·         IRS Forms Availability Table for TurboTax Business

·         State Forms Availability Table for TurboTax Business

·         What does "Tax Form Under Construction" mean?

 

Click on the REVIEW tab and the program will tell you what in your return is still NOT ready and the estimated date it will be (subject to change of course ) ... you can put in for an email alert when they are ready ....

[LaughTrack]

I have good news and bad news.   The good news is I did come to a solution after playing with the questionnaire several times.  The bad news is I can't remember exactly which question or qualification I needed to change my answer on to make the deduction happen.    If I run into the same issue this year and solve it, I'll comment again.

[Critter-3]

Once you have the 1095-A form ... then you will enter it only in the 1095-A section and link it to the Sch C ... in the Sch C section it tells you to do this ... follow the interview screens when they are fully operational in January or February.

https://ttlc.intuit.com/community/credits-and-deductions/help/where-do-i-enter-my-1095-a/00/26456

[Anonymous]

if you have not entered the Schedule C info, you have no income to deduct the SE Health Insurance.