Self-employed health insurance and Medicare (again!)

[appelman]

When did you get this, and how???

..................

When did you get this, and how???

[solomon]

But... just who is "us"?

This was a response from IRS to this question. I posted it to show such a lack of substantial authority from the responder from the IRS. Analogous to their response to lenboush on the FTHB relationship question - although they did indirectly reference a couple of items for him.

[solomon]

When did you get this, and how???

12/20/2007.

http://www.irs.gov/help/page/0,,id=120294,00.html

Scroll down to the bottom.

[appelman]

Thanks!

Amazing! They sure have it buried. I could only find it through a search of their site index.

[appelman]

Does white man speak with forked tongue?

The latest from the IRS:

Your Question Was:
I am retired and drawing social security. I also operate a very small one-person business. I carry private medical insurance, including dental and prescription drug coverage, as well as long-term care insurance. I deduct the premiums above the line as self-employed health insurance. As a condition of coverage, my insurer requires me to subscribe to Medicare B. May add my Medicare B premiums to my self-employed health insurance deduction? Thank you for your assistance.

The Answer To Your Question Is:
Thank you for using our service.
I assume that the activity is operated as a sole proprietorship (Schedule C-Profit or Loss from Business).
Medicare insurance payments (Medicare B) does not qualify as insurance under the self-employed health insurance deduction as explained in Publication 535 (Business Expenses). For self-employed sole proprietors, an insurance plan can be established under their name and no longer is required to be established under their business.

Does white man speak with forked tongue? Yes he do!

[FEDUKE404]

The old razzle dazzle at play

The latest from the IRS:

Your Question Was:
I am retired and drawing social security. I also operate a very small one-person business. I carry private medical insurance, including dental and prescription drug coverage, as well as long-term care insurance. I deduct the premiums above the line as self-employed health insurance. As a condition of coverage, my insurer requires me to subscribe to Medicare B. May add my Medicare B premiums to my self-employed health insurance deduction? Thank you for your assistance.

The Answer To Your Question Is:
Thank you for using our service.
I assume that the activity is operated as a sole proprietorship (Schedule C-Profit or Loss from Business).
Medicare insurance payments (Medicare B) does not qualify as insurance under the self-employed health insurance deduction as explained in Publication 535 (Business Expenses). For self-employed sole proprietors, an insurance plan can be established under their name and no longer is required to be established under their business.

Does white man speak with forked tongue? Yes he do!

He is obviously (likely merely reading) spouting "the newest company way" from the note in Pub 535 and has no awareness of the related issues that have been raised/upheld elsewhere within the vast walls of the IRS. Reminds me of a day when I visited the local IRS office to get some assistance on a very technical issue and the first thing the "expert" did was flip to the index of Pub 17 and proceed with the "20 questions" route with me.

Fortunately, for now, this issue is only a "theoretical" one for my clients and myself. Hopefully at some point it can be resolved before I have to cross the Rubicon on the Medicare B issue....or just really retire instead!

BTW: I wonder what the guy would have said about Medicare D ???

FE

[New York Enrolled Agent]

Look at page 29 (lower left column) of the 2010 1040 instructions posted 12/30/10 discussing the SE health insurance deduction.

Medicare Part B premiums can be used to figure the deduction.

Answer to the question or an error by the typist?

[dtlee]

Look at page 29 (lower left column) of the 2010 1040 instructions posted 12/30/10 discussing the SE health insurance deduction.

Medicare Part B premiums can be used to figure the deduction.

Answer to the question or an error by the typist?

Wow....it took me a while to find that.....initially I brought up the 2009 version thinking it was current and could not find the information on the page you referenced. Obviously, they put it where you can get to it first. Great find. It does not look like a typo to me.

[appelman]

Jeepers!

Can't these guys ever get their heads on straight?

[S T]

Thanks NYEA

Thanks NYEA for pointing this out,
Many discussions, many viewpoints over the last few years on this subject
Wonder if this is part of the "Health Care Reform Act"?

2009 Form 1040 Instructions say "cannot"
2010 Form 1040 Instructions say "can"

Typo? or ?
Sandy

[PIGLEE]

I also checked in Pub 535, page 18 right in the middle of the page where it says "TIP" it says:

Medicare Part B premiums are not considered medical insurance premiums for purposes of the self-employed health insurance deduction.
Take the deduction on Form 1040, line 29.


Sounds like this says both ways. Like they have added the last line to the old law.

[solomon]

I also checked in Pub 535, page 18 right in the middle of the page where it says "TIP" it says:

Medicare Part B premiums are not considered medical insurance premiums for purposes of the self-employed health insurance deduction.
Take the deduction on Form 1040, line 29.


Sounds like this says both ways. Like they have added the last line to the old law.

Are you reading the 2010 or 2009 version.

[Jiggers]

2009 version?

I also checked in Pub 535, page 18 right in the middle of the page where it says "TIP" it says:

Medicare Part B premiums are not considered medical insurance premiums for purposes of the self-employed health insurance deduction.
Take the deduction on Form 1040, line 29.


Sounds like this says both ways. Like they have added the last line to the old law.

I think you are reading the 2009 version as the 2010 is not on the IRS website yet.

[PIGLEE]

I did not look, it is the 2009 version, posted in March 2010

[ChEAr$]

Well then, if IRS seems to sanction the medicare b deduction above the line, might we not take it that an S corporation may now adopt said coverage for a 2%'er in ADDITION to the medigap insurance?