confused about self-employed health insurance deduction

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  • #2388
    RustyShackleford
    Participant

    I am deeply confused about whether I can take the self-employed health-insurance deduction (SEHID).

    I am retired but with a little self-employment income from consulting. I am on a Medicare Advantage plan through my former employer, for which I pay some of the premium, and I’m also required to pay the Medicare part B premium. Certainly the MA plan is a group plan through my employer; but OTOH, I qualify for Medicare B independent of my former employer and it’s stated that Medicare premiums are deductible.

    In March I married an employed woman whose employer provides her with a good health-insurance plan which I could certainly join. Clearly this disqualifies me from the SEHID (except for January and February), since I could join her plan. Or could I ? Since I’m already on Medicare maybe I can’t, meaning if my Medicare premiums qualify for SEHID, perhaps I can deduct them for the entire year.

    Like I said, I am confused.

    P.S. I understand that I could take all these expenses on Schedule A (if the standard deduction were not now so high), and that if I qualify for SEHID, the deduction cannot exceed my net self-employment income.

    #2392
    RustyShackleford
    Participant

    Focusing my question:

    1. Are my Medicare B premiums considered to be for a “subsidized group health plan through employer” (which is disqualifying for SEHID) since they are required as part of my employer-sponsored retiree Medicare Advantage plan ?

    2. Is that Medicare Advantage plan itself considered a “subsidized group health plan through employer” or is it simply a “group discounted policy” ?

    3. If the answer to #1 is to my advantage (“no”), am I able to deduct the Medicare B premiums for the months after I became married to a spouse who had a “subsidized group health plan through employer” ? Normally the answer would be “no”, except I’m not sure I was eligible to join her plan, since I was already on Medicare. Maybe a question for her employee health insurance provider.

    #2398
    RustyShackleford
    Participant

    Called spouse’s health insurance company; they say I can (and could’ve in 2018) have joined her policy and they had no requirement that I stay on Medicare. Called Medicare and they say I could suspend for as long as I’m on spouse’s policy (and not pay the premiums).

    So I believe I’m SOL from month of marriage (March 2018). And for Jan & Feb, can only deduct Medicare, since it seems clear that my Medicare Advantage is “employer subsidized” (because rate sheet says “The Retirement Systems share for Retiree subscribers is $403.06”.

    A poor result, only 2 * $134 deduction. Better than a sharp poke in the eye, I suppose.

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