Good news for owner-operators who buy their own health insurance: You can deduct the entire portion on next year’s income tax.
Good news for owner-operators who buy their own health insurance: You can deduct the entire portion on next year’s income tax. That’s not a credit – a full rebate – but it is an improved tax break. “It’s about time,” says Perry Wiseman of Truckers Accounting Service in Omaha, Neb. For 2002, only 70 percent was deductible, he says, and for at least a few years before then, only 60 percent could be claimed.
Here are a few qualifications, including one curveball:
If deducting 100 percent of health premiums still doesn’t make insurance affordable for you, ask your accountant about getting a less expensive, high-deductible policy and establishing a Medical Savings Account. An MSA allows you to save money tax-free, with earnings, to spend on those high deductibles.
This latest tax break is hardly a cure-all for health costs. But for the owner-operator who’s running with no plan for health expenses, it can be a starting point for helping to control the costs you will inevitably incur.
HEALTH COVERAGE ALTERNATIVES
If you have a pre-existing or other high-risk condition and cannot afford traditional health policies, consider these options: