Self-Employed Health Insurance Deduction vs. form 1095-A entries

[bart1]

You would think they could apply that section to all of the scenarios listed in the IRS instructions. There are several, and S-Corps are even toward the bottom of the list. Maybe Intuit needs some more prodding!

[cmdv]

I saw a comment above that we are a very small segment of the population?  (Those who are getting 1095A forms)  NO EXCUSE!!   I guess my particular situation is not very many people at all..... that's proably true.  I had some subsidy AND a conflict with the 1095 B that shows some of the same months as being covered... and now- there's a refund from Anthem? ( april 2018 re 2017 actual premium paid) OMG it is messy and Turbo Tax  is not helping.

[buck1400 · Accepted solution]

You are correct to enter the health insurance premium information from your 1095-A in the Personal > Health Insurance section in TurboTax.  This is information will be used in Form 8962 to determine any adjustment needed in the premium tax credit your received.  Form 8962 Line 26 will show the resulting over/under tax credit and be transfered to your 1040 Line 69.

Since you self-employed, you are also permitted to deduct your portion of the health insurance premiums (total premium minus the premium tax credit your are permitted) as a business expenses.  TurboTax will compute this amount and enter it on 1040 Line 29.  If no amount amount is showing up on 1040 Line 29, go through the Personal >Health Insurance section again making sure to answer the question about being self-employed AND selecting the Schedule C to which you want to attach the deduction.  When you are stepping through the questions, you have to click on "edit" when you get to the 1095-A data screen.  The self-employment question is on the page after you have reviewed your 1095-a entries. 

[mrpooh]

Thanks for taking the time to answer my question.  I just spoke with someone at TurboTax who also confirmed this.  

Like you wrote, the idea is to just enter my info in the 1095-A section (Personal > Health Insurance) and TurboTax  ("knowing" that I'm filing as a self-employed business) automatically transferred that info correctly into the appropriate line on form 1040 (line 29) for the Self-employed health insurance deduction.

Mystery solved.  Of course it makes sense, and there were even instructions, but I wanted to make sure.

[hfp54]

It is important to not enter the health insurance premiums on the Schedule C if you are going to enter it on the 1095 A.  I went back and tried it and now it gives a correct answer.  The Schedule C step by step needs to be clearer on this point, if you have a 1095, do not enter the health insurance premium paid on the Schedule C (it comes first in the interview process). Mystery and bug solved.

[mrpooh]

Right on, brother (or sister, whatever the case may be).
  
I agree about the possible benefit of additional clarity in the instructions.  

For example, TurboTax might tell a user who is in that Sch C section, if s/he has paid premiums to a plan acquired in the marketplace (and who has a 1095-A form) to FIRST go to the section Personal > Health Insurance and enter the info THERE.  And to be assured that TurboTax will automatically transfer an appropriate calculation based on those figures to the section on form 1040 for the self-employed health insurance deduction.  And only to enter that info in the Schedule C section if nothing has been transferred.  Or something like that.

Thanks for adding your input to this issue.

[susandamore]

This is all helpful.  I completed the 1095-A and indicated that the insurance is connected to my Schedule C.  My issue is that the deduction that is being calculated on Line 29 is less than I would expect.  I have sufficient Schedule C income to be able to deduct 100% of my health insurance but only about 25% of the cost is flowing through to Line 29.  Anyone have ideas what I might be missing?

[hfp541]

Same thing on my return. I think the premium tax credit you receive is deducted from the total premiums paid and the difference is allowed as the line 29 deduction.  See the original answer by buck1400 at the top of this string.

[susandamore]

Yes, that is how it works but, in my case, I am not getting any credit but the Line 29 deduction is still being reduced…

[hfp541]

i have no idea. Check the figures you entered. You should be able to deduct health ins premiums on line 29 up to the total of Schedule C minus the deductible SE tax.
What does the line 29 worksheet say in the comments section?

[susandamore]

Can you tell me where I find the Line 29 worksheet?

[susandamore]

I found the worksheet and the odd thing is that Line 1 - which is total premiums paid - is zero even though I accurately completed the 1095-A input.

[susandamore]

For anyone that has this problem of the premiums not carrying over from the 1095-A…I just spoke to Turbotax tech support and the solution as of 3/2/16 is to go to Forms\Schedule C\Health LTC Wks and override the blank amounts with the correct premium amounts.

[susandamore]

Warning - just tried this and it seems to mess up the tax credit calculation so it might be necessary to wait for a real fix from Turbotax….

[DD660]

One thought, the 1095A form input has a question asking if you were self employed and bought through the marketplace.  Possibly this was not checked?  There is a "more info" box which says:

What if I'm self-employed and bought health insurance through the Marketplace?
If you reported self-employment income on any of the schedules listed below AND you used that income to buy health insurance through Healthcare.gov or your state Marketplace, you can deduct your premiums on your taxes. However, you need to tie that income to your 1095-A so we can properly calculate the deduction amount.
- Schedule C - Self-employed business income
- Schedule F - Farm income
- Schedule K-1 partnership

I think they mean by checking the box "if you were self employed and bought through the marketplace, it will then properly "tie it" to your self employment income.  So, this implies that the insurance cost must also be listed on one of the business expense forms.  

I have to try this myself but if you didn't check that box, I think turbo tax automatically assumes the amount is then included in your personal medical expense.  Which happened to me as I did not check that box accidentally.  If self employed and paying insurance with that income, I don't think there should be an insurance amount on the personal portion of your return.
DD