Health insurance premiums
Its tax time again and you may be wondering ‘are health insurance premiums tax deductible or not?’ This will depend on a large number of factors such as who you are, what you do, how much money you make and the like. If your employer or your insurance company did not refund your medical expense or that for your spouse, children or other dependents and you had to bear the expenses yourself, then you can claim for a tax deduction. Claims for such deductions can be filed only if the medical and dental expenses were paid during the particular tax year irrespective of when the services were availed.
For tax calculations, the date of payment depends on the mode of payment. If the payment was in cash, then the date is the actual day on which you paid. If you wrote a check, then the date of payment is when you sent it or deliver it. if the payment was done online or using a pay-by-phone account, then the date would be the one that is reported on the statement. In addition, if you make the payment using a credit card, then it would be the day on which the charge was made and not the day on which you paid.
Medical Insurance premiums
Insurance premiums that you pay for medical care policies that cover surgical services, X-rays, hospitalization, physical examination, dental, false teeth, insulin, diagnostic test, prescription drugs, contact lenses, eyeglasses, artificial limbs, crutches, wheelchairs, hearing aids and qualified long-term care services can all be claimed during the tax year.
Qualified long-term care services should include treating, curing, diagnostic, therapeutic, preventive, rehabilitative services. It should also include personal and maintenance care services that a terminally ill patient requires.
Insurance and tax deductions
Medical premiums
Medicare premiums that you pay can also be deducted during the tax year. You can deduct the premiums if you are not covered under Social Security (or where not a government employee who paid Medicare tax) and therefore has voluntarily enrolled for Medicare A. you can claim such amounts even if you have the Medicare B which is basically a supplemental medical insurance. Medicare D payments can also be included as it is intended for people with Medicare A or B for prescription drugs.
Hope that answers you queries regarding, ‘Are health insurance premiums tax deductible?’ If you still have doubts, arrange for a meeting with a tax consultant who can help you out.