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04-19-2018 03:46 PM
As self-employed (SE) I understand I can deduct the ACA health insurance premiums for my family that are in excess of any premium tax credits (PTC) we receive on L29 (above-line), as long as the health insurance is purchased with after-tax dollars in my name or that of the business. For Dependent A in an in-state college, we included him in the same ACA insurance since he has access to our network. And it makes sense that his MAGI was included in the household MAGI to figure out the PTC, which had the effect of reducing it, but we still got to include the SE insurance premiums (including his) in excess of the PTC on L29. But I'm not sure how to treat the insurance premiums for Dependent B who is in an out-of-state college that we purchased insurance for through her school. We were still required to include her MAGI in figuring out the PTC, which again further reduced the PTC for our ACA insurance, and increased the out-of-pocket ACA premiums we paid and that goes on L29. But what do we do with her insurance premiums? While I paid for it, because the insurance is not in my name, doesn't that mean I can't count it toward my total SE insurance premiums to include in L29? The program seems to imply you can do that for an adult child who is "not your dependent" (and I'm not even sure how that's allowed if their insurance is not in your name) but doesn't address a dependent child with a separate insurance. Any insights would be much appreciated.
04-20-2018 10:12 PM
You have me stumped with this one. I see the nuance in what you're asking, but I did some research and couldn't come up with anything different than what you've already found. Nothing that really clarifies the situation.
Sorry I couldn't be of more help.
04-21-2018 12:07 AM
Thanks for your response. Yeah, I was hoping someone (and you, since you do have a lot of insights) would see something I'm missing. It looks like a flaw or oversight and somewhat defeats the "keep your kids on your insurance" thing. What gets me is that the her insurance premium is about 30 percent of her AGI contribution and certainly would qualify for additional PTC, and the out-of-pocket premiums would be fully deductible as part of L29 if she were on our ACA insurance. But just because she is out-of state, not only does her portion of our total insurance premiums not qualify for the PTC, her AGI reduces our PTC and we also can't deduct her out-of-pocket premiums. Just doesn't seem right, but what can you do?
04-22-2018 08:41 PM
I know it's a little late now, but is there a reason you didn't include her on your marketplace policy or buy a marketplace policy for her? If your policy's network would only cover her in your home state, it may be that there is a different policy that offers a wider network on the marketplace that you could sign her up for. It may mean creating a separate marketplace account (in your name, of course) to create an application for just her. If she's out-of-state as a student, I think she's still considered a resident in the state where you live. Maybe that would be a possibility for 2019 if she'll still be a student then.
We're also self-employed. In order to be able to apply for catastrophic policies for our two sons, we had to create 2 additional healthcare.gov accounts (all under my husband's name)-- one for each of them-- in order to get the catastrophic coverage because the healthcare.gov site won't even show you these plans if you have more than one person on an application. It's a pain, but you do what you need to do!