Self-Employed Health Insurance

Question

I'm looking to get health insurance for my wife, my son, and I. I am a self-employed business owner in Texas. The IRS states that I'm eligible to deduct the amount I pay for health insurance if I have a net profit for the year and I establish the insurance plan under my business name. My question is: am I obligated to also cover my two employees if I establish the plan under the the business name? The premiums nearly tripled when I got a quote including my employees versus just my family.

Answer 1

This is not tax advice and you will need to consult a qualified tax professional but there is no IRS requirement that a sole proprietor must have an insurance plan under a business name in order to be eligible for the self employed health insurance tax deduction (however it is true that you must have a net profit for the year - the deduction cannot cause the company to have a loss).

Of course, a lot depends on the type of entity that your business is set up as (you may not even be operating as a sole proprietor but as an LLC, Corp, S-Corp, etc.) so be sure and check with an experienced Texas health insurance agent.

Here is some more information on small business health insurance options and also some information specifically on health insurance in Texas: