Question: Can I claim self-employed health insurance deduction (1040, line 29), if now part of my premiums are subsidized by Obamacare? If yes, what will happen after IRS reconciles the advance premium tax credits (subsidy) for 2014 and withholds certain amount, because my income is more than I projected? Will I be able to claim that I paid this extra amount as health insurance premiums and add it to 2014 deduction?
Answer: You can only claim the net premium - the portion you actually pay after the subsidy - as an expense. Enter that portion as your self-employed health-insurance deduction. If there is a subsidy reduction for added income at the end of the year, that incremental net premium would also be added to your self-employed health-insurance deduction.