The premiums, which represent the amount the policyholder pays the insurance company to maintain the effectiveness of the policy, can be deducted by the taxpayer, the taxpayer’s spouse and other dependents. The rules for tax-deductibility are somewhat different for a person who is self-employed. You can deduct the premium, provided you realized a net profit. It is not required that your medical expenses are greater than a specific percentage of your income.
However, there is a maximum premium amount that is deductible. This figure is dependent on the age of the plaintiff at the end of the year. Below are the caps on deductibility for 2016. Any premium amounts that exceed these restrictions are not deemed to be a deductible medical expense.
Age prior to the end of the taxable year / Maximum deduction for the year
- 40 or under / $390
- Over 40 but not over 50 / $730
- Over 50 but not over 60 / $1,460
- Over 60 but not over 70 / $3,900
- Over 70 / $4,870
The elder law attorneys at Hook Law Center assist Virginia families with will preparation, trust & estate administration, guardianships and conservatorships, long-term care planning, special needs planning, veterans benefits, and more. To learn more, visit http://www.hooklawcenter.com/ or call 757-399-7506.