# Self-Employed? You Can Deduct 100% of Your Health Insurance Premiums (Here’s How)
If you’re self-employed, a freelancer, or a small business owner, there’s a good chance you’re overpaying for health insurance — and leaving a significant IRS tax deduction on the table.
Most people don’t know this exists. The ones who do know it often don’t know how to use it. This article breaks it down plainly so you can start saving money immediately.
What Is the Self-Employed Health Insurance Deduction?
The IRS allows self-employed individuals to deduct 100% of health insurance premiums paid for themselves, their spouse, and their dependents. This is an above-the-line deduction — meaning you don’t need to itemize to claim it. It comes directly off your adjusted gross income (AGI).
What that means in plain English: If you’re in the 22% tax bracket and paying $600/month in premiums ($7,200/year), that deduction saves you approximately $1,584 in federal income taxes — every single year.
And that’s before we talk about the HRA-105.
Who Qualifies?
You may qualify for the self-employed health insurance deduction and the HRA-105 if you are:
- A sole proprietor (Schedule C filer)
- A freelancer or independent contractor
- A self-employed individual with no access to employer-sponsored coverage
- A small business owner — including farmers, ranchers, contractors, consultants, and more
- S-Corp shareholders who own more than 2% of the company
The key requirement: you cannot be eligible for health coverage through an employer (including your spouse’s employer plan) during the months you’re claiming the deduction.
A Real-World Example
Let’s say you’re a self-employed contractor in Florida, paying $650/month for health insurance ($7,800/year). You also spend $2,400/year out-of-pocket on medical expenses.
Without the HRA-105:
- You deduct $7,800 in premiums
- At 22% bracket: ~$1,716 saved
With the HRA-105:
- You deduct $7,800 in premiums + $2,400 in out-of-pocket costs = $10,200 total deduction
- At 22% bracket: ~$2,244 saved
- That’s an extra $528/year just by setting up the structure correctly
And that’s a conservative example. Higher earners and those with greater medical expenses save significantly more.
Ready to Stop Overpaying?
If you’re self-employed or own a small business and you’re not sure whether you’re getting the most out of your health insurance, let’s talk.
📞 Call or text me directly: (561) 345-0571
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