Self-employed health insurance

[Black Bart]

I really, really, really hate to bring this subject up again (the argument's been beaten to death here previously) and some will cringe at the mere mention, but a client is pressing me. Did we ever reach a consensus on whether medicare is or is not qualifying SE health insurance?

I was thinking we decided it was not, but that some disagreed and were doing it anyway. Anybody know for sure?

[solomon]

My position is no but read the following email from the IRS after my request on an opinion and an authority for it. Note the "authority."

The Answer To Your Question Is:

Thank you for using our Email service. Assuming you meet all the requirements to take the self-employed health insurance deduction, you would be able to use the Medicare Part B Premiums.

The following information is from the 2007 U. S Master Tax Guide (page 356).

Health and Accident Insurance Premiums Amounts paid as self-employment tax or as employee tax for hospital insurance under the Medicare program are not medical expenses. Similarly, the basic cost of Medicare insurance (Medicare A) is not deductible unless voluntarily paid by the taxpayer for coverage. However, the cost of extra Medicare (Medicare B) is deductible.

Please contact us with any further questions

[Kram BergGold]

My opinion

I am taking it until a Court makes a definitive ruling.

[Jiggers]

Medicare Premiums

Solomon,
this came from the IRS?

"The Answer To Your Question Is:

Thank you for using our Email service. Assuming you meet all the requirements to take the self-employed health insurance deduction, you would be able to use the Medicare Part B Premiums.

The following information is from the 2007 U. S Master Tax Guide (page 356).

Health and Accident Insurance Premiums Amounts paid as self-employment tax or as employee tax for hospital insurance under the Medicare program are not medical expenses. Similarly, the basic cost of Medicare insurance (Medicare A) is not deductible unless voluntarily paid by the taxpayer for coverage. However, the cost of extra Medicare (Medicare B) is deductible.

Please contact us with any further questions"

[Black Bart]

...The following information is from the 2007 U. S Master Tax Guide (page 356)...

I (like Jiggers) am surprised that IRS is quoting Master Tax Guide, but nowadays who knows what they'll say? -

...(Medicare A) is not deductible unless voluntarily paid...However, the cost of extra Medicare (Medicare B) is deductible...

This sounds good and I'm going to take it, but -- come to think of it -- what about Medicare D (the drug coverage)? It would do some good to transfer it out of subject-to-7.5% deductible itemized medical expenses over to 1040 adjustments to income -- wonder if that would also be eligible (after all, it's "health" insurance of a sort.)?

[Jiggers]

Medicare

This is the first time that I have seen anything from the IRS that looks like Medicare Premiums are deductible as Self-employed health insurance. I looked up the reference in the 2007 Master Tax Guide and that is what it says.

Now, husband and wife, both on SS, both with Medicare premiums deducted from their SS, operate a farm in husband's name. Community property state.

Take both Medicare premiums?

[Bees Knees]

CCH did not say it was deductible for purposes of the SE health insurance deduction. It merely said the extra cost of Medicare Part B is deductible as a medical expense. That has never been in dispute.

It is NOT deductible for purposes of the SE health insurance deduction.

I stand by my original argument made back in September of 2005.

http://www.thetaxbook.com/forums/showthread.php?t=242&pp=15

[Jiggers]

IRS comment

The IRS seems to be clear in their statement:

"Thank you for using our Email service. Assuming you meet all the requirements to take the self-employed health insurance deduction, you would be able to use the Medicare Part B Premiums."

[solomon]

Solomon,
this came from the IRS?

Yes it did on Dec. 20, 2007. Note the flat statement that Medicare B can be used as an adjustment to gross income - self employed insurance. Then it cites the CCH Master Tax Guide, which is not only not an authority but really does not say that. It simply says it is deductible (presumably as an itemized deduction).

I guess showing the source of the statement is permissible.

EMPLOYEE ID: 2504057 Mr. mcneilly Tel.(800)829-1040 msg#: 1762356

Here is a Link for emailing in case anybody else wants to try:

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

[Black Bart]

What was I sayin'

...Medicare Part B is deductible as a medical expense. That has never been in dispute.
It is NOT deductible for purposes of the SE health insurance deduction. I stand by my original argument made back in September of 2005.http://www.thetaxbook.com/forums/sho...hp?t=242&pp=15

just the other day about those dirty, rotten, low-down, inexcrupulous Yankee reg-rats undercuttin' my tax positions, theories, and deductions? Here I was home free with B, fixin' to throw in D to boot, and now this Bees-come-lately torpoedoes my tax dodge.

It's a danged outrage and I'm turnin' him in to Publisher Brad.

_______________________________
Suffer nobly, brethren; then shall ye
find redemption and reward -- Black Bart

"I cain't see the wildcat!" -- hunting buddy
"Then shoot up in here; one of us has gotta have some relief!" -- Jerry Clower

[Black Bart]

Wait, wait!

I know what -- let's ask NYEA. He's always cruisin' around the board and knows lots more stuff than most anybody else around here. If we can get hold of him, maybe he'll argue down the unenlightened Beeswaxer and save that child -- strike that -- I mean save that deduction.

P.S. Sandy was right -- I shouldn't have give'im that cussin' the other day.