Biz Plan......Help! Tom!

[MissAnn]

I signed up with Biz Plan. I paid and was ready to go! Today I called to ask a question and subsequently found out I cannot deduct my premiums? Why you ask? Because we have Obamacare. Doesn't matter that we don't qualify for the sliding scale discount. We pay full price. Tom Copeland....is this true? We paid out $12,000 in premiums and $8,000 in medical costs (rough year....cancer with my husband).....

What are my options? Can I only deduct costs over 10% of our income?

Our insurance on Obamacare is about to skyrocket to $1600/month with a $10,000 deductible. How in the world do we pay this?

[TomCopeland]

Originally Posted by MissAnn

I signed up with Biz Plan. I paid and was ready to go! Today I called to ask a question and subsequently found out I cannot deduct my premiums? Why you ask? Because we have Obamacare. Doesn't matter that we don't qualify for the sliding scale discount. We pay full price. Tom Copeland....is this true? We paid out $12,000 in premiums and $8,000 in medical costs (rough year....cancer with my husband).....

What are my options? Can I only deduct costs over 10% of our income?

Our insurance on Obamacare is about to skyrocket to $1600/month with a $10,000 deductible. How in the world do we pay this?

There may be a misunderstanding here. You can deduct health insurance premiums as a personal expense on Form 1040 only if you are not eligible to be covered by health insurance through an employer. But, even if you can't deduct premiums as a personal expense you can deduct your health insurance premiums through Biz Plan as a business expense. I'm not sure why Biz Plan is saying you can't deduct health insurance premiums because you are on Obamacare. That shouldn't make any difference. I have not heard of this before. I'd check back with Biz Plan again. Let me know what they say.

[MissAnn]

Originally Posted by TomCopeland

There may be a misunderstanding here. You can deduct health insurance premiums as a personal expense on Form 1040 only if you are not eligible to be covered by health insurance through an employer. But, even if you can't deduct premiums as a personal expense you can deduct your health insurance premiums through Biz Plan as a business expense. I'm not sure why Biz Plan is saying you can't deduct health insurance premiums because you are on Obamacare. That shouldn't make any difference. I have not heard of this before. I'd check back with Biz Plan again. Let me know what they say.

Thank you.....and I will call them again and talk to a different person. He was very adamant this was true even if we don't get a discount with the sliding scale. He said Obamacare is already discounted and we would be paying higher premiums if we got insurance privately. I hope that's not true!

[TomCopeland]

Originally Posted by MissAnn

Thank you.....and I will call them again and talk to a different person. He was very adamant this was true even if we don't get a discount with the sliding scale. He said Obamacare is already discounted and we would be paying higher premiums if we got insurance privately. I hope that's not true!

You may or may not be able to get cheaper health insurance privately rather than through Obamacare. But, regardless, whatever you do pay for health insurance would be deductible as a business expense if you set up an HRA plan through Biz Plan. That's what you want to check with them about.

[MissAnn]

Whoo Hoo! You are right Tom! I called back and got a totally different answer. It was confirmed by someone else as well. You can even do section 105 if you are taking the subsidy off Obamacare...but they don't recommend it. The reason is that if your income is higher than expected you might have to pay back the subsidy amount. Thanks so much for helping us with these situations!

[TomCopeland]

Originally Posted by MissAnn

Whoo Hoo! You are right Tom! I called back and got a totally different answer. It was confirmed by someone else as well. You can even do section 105 if you are taking the subsidy off Obamacare...but they don't recommend it. The reason is that if your income is higher than expected you might have to pay back the subsidy amount. Thanks so much for helping us with these situations!

Glad to hear this!