Are Health Insurance Payments Tax Deductible?

are health insurance payments tax deductible

If you are looking for an answer to the question, are health insurance payments tax deductible, you may be surprised at the answer. Taxation law does not necessarily recognize a health plan as a tax-deductible expense. Rather, the Internal Revenue Service considers any expense that is related to health insurance, to be deductible under section 1040(a) of the IRS code. What is deductible, actually, is determined by the individual and depends on several circumstances.

First, you may be able to deduct the cost of medical coverage provided as a part of an individual health plan. This type of coverage may be provided as an HMO (or Health Maintenance Organization), PPO (or Preferred Provider Organization), or other such managed care service. Health insurance premiums paid for group health plans may also be deducted. Finally, some employers (including trade unions) may be able to make deductions for health-related expenses related to providing health care to their employees. These include deductibles, out-of-pocket expenses, and similar items.

For most people, one of the biggest questions regarding tax benefits related to health care is whether are health insurance payments tax deductible. The fact is that there are rarely any tax benefits available for health-related expenses. Medical costs are something that are incurred long before any tax is charged, and only when those expenses exceed a certain amount. Those tax benefits are most often reserved for those situations where the hospital stay, physician visit, or similar medical treatment is absolutely necessary, and it is impossible to obtain health care outside of the hospital setting.