Edmund G. writes, My mother, who is a U.S. citizen and lives here, is concerned about her overseas properties and income. Because she keeps it separate from her U.S. income - she never brings or transfers a substantial amount into the country - she figures she is not liable for reporting it to the IRS. Can I take a tax deduction for health care premiums as a self-employed person as well as take the tax credit for the health premium in CoveredCA? I'm hesitating to sign up under CoveredCA until this question is answered. Under the Affordable Care Act, if a household's modified adjusted gross income is less than four times the poverty level, it could get a tax credit (also called a premium subsidy) that reduces the cost of health insurance purchased on an exchange. The act says that "no deduction is allowed for the portion of premiums paid by the taxpayer for coverage of one or more individuals under a qualified health plan that is equal to the premium assistance credit," he adds. Luscombe says the language is probably broad enough to cover both, and has read other commentators who agree that "the premium assistance credit would have to be deducted from the health insurance premium in calculating the self-employed health insurance deduction.""The reader would have to work through the circular calculation to see if a self-employed health insurance deduction reduced by the premium assistance credit would produce a modified AGI that would still entitle the reader to a premium assistance credit," Luscombe says.
Reported by SFGate 1 hour ago.
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