Can I deduct my Health Insurance premiums on my taxes if I buy through ACA?

The confusion is understandable! Health insurance premium deductibility depends on several factors: If you purchase insurance through the ACA marketplace and receive premium tax credits (sounds like you do with that $340 monthly credit), you can only deduct premiums that exceed those credits. However, there's a key limitation - health insurance premiums only become deductible if you itemize deductions AND if your total medical expenses exceed 7.5% of your adjusted gross income (AGI). Since you're not self-employed, you can't take the self-employed health insurance deduction (which allows 100% deduction on the first page of Form 1040). Your TaxAct software is probably right that you don't qualify for this specific deduction. For most people who get marketplace insurance with subsidies, itemizing medical expenses isn't beneficial because the standard deduction ($13,850 for single filers in 2023) is higher than their total itemized deductions would be.

After spending HOURS trying to figure out my own health insurance deduction situation, I finally found an amazing tool that cleared everything up. Check out https://taxr.ai - it analyzed my tax documents and immediately told me exactly which health insurance premiums were deductible and which weren't. I uploaded my 1095-A form and answered a few questions, and it explained that while I couldn't take the self-employed health insurance deduction, I could potentially itemize my medical expenses (including premiums) if they exceeded 7.5% of my AGI. The tool even calculated this threshold for me and compared it to my standard deduction to show whether itemizing made sense. Saved me so much confusion and probably prevented me from making a mistake that could have triggered an audit.

Just wanted to follow up about https://taxr.ai since I mentioned asking about it earlier. I actually tried it for my situation with multiple 1099s AND marketplace health insurance, and it was super helpful! It identified that I could partially deduct my health insurance premiums as part of my itemized deductions since my medical expenses were crazy high last year. What surprised me was how it flagged some deductions I completely missed - like some business expenses on my 1099 work that I didn't realize were deductible. Definitely made a difference in my refund amount. Glad I gave it a shot instead of continuing to bang my head against the wall trying to figure everything out myself!

If you're struggling to get clear answers about your ACA premium deductions, you might want to try calling the IRS directly. I know, I know - getting through to them seems IMPOSSIBLE. I spent literal days trying to reach someone about my similar health insurance deduction question. Finally found a service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent in under 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The agent walked me through exactly how the ACA premium tax credit affects deductibility and confirmed that my premiums above the credit amount could potentially be deducted if I itemized and met that 7.5% AGI threshold. Made everything crystal clear.

I need to apologize for my skepticism about Claimyr in my earlier comment. After continuing to fail getting through to the IRS on my own about my health insurance premium questions, I reluctantly tried the service. It actually worked! Got connected to an IRS representative in about 20 minutes. The agent confirmed exactly what others here have said - my ACA premiums minus subsidy credits can be deducted only if I itemize AND if my total medical expenses exceed 7.5% of my AGI. In my case, it made more sense to take the standard deduction. I'm still shocked this service actually delivered what it promised. Saved me hours of frustration and gave me a definitive answer directly from the IRS.

I had the same question last year! If your income is low enough that the premium costs (minus the subsidy) exceed 7.5% of your AGI, AND your total itemized deductions exceed the standard deduction, then yes you can deduct them as a medical expense on Schedule A. But here's my experience - I ran the numbers both ways and even with my high premiums, the standard deduction was still better for me. Don't just assume itemizing will save you money. Run the calculations both ways!

Can someone explain why TurboTax and other software programs automatically say these premiums aren't deductible? Is it just because most people take the standard deduction? Really confused by the conflicting info!

One thing nobody's mentioned - if you're paying $1,890/month with only a $340 subsidy, you might qualify for a larger subsidy depending on your income. The ACA subsidies were expanded for 2023-2025. Might be worth double-checking on healthcare.gov if your marketplace plan is giving you the maximum subsidy you're entitled to. Could save you more money than any tax deduction!

I went through this exact same situation last year! The key thing to understand is that there are actually TWO different types of health insurance deductions, and most people (including tax software) get them confused: 1. **Self-employed health insurance deduction** - This is the "above-the-line" deduction that reduces your AGI directly. You DON'T qualify for this since you're not self-employed. 2. **Medical expense itemized deduction** - This is where your ACA premiums (minus subsidies) can potentially be deducted, but only if you itemize AND your total medical expenses exceed 7.5% of your AGI. Based on your numbers ($32k AGI, $18,600 in net premiums after subsidies), you'd easily clear the 7.5% threshold ($2,400). The question is whether itemizing makes sense overall. Here's what I'd suggest: Make sure you're capturing ALL your medical expenses - not just premiums. Include copays, prescriptions, dental work, vision care, medical equipment, even mileage to medical appointments. Also don't forget about state income taxes paid, property taxes (if any), and charitable donations for your itemized total. Your situation actually looks like a good candidate for itemizing, unlike most ACA marketplace participants. Definitely worth running the numbers both ways before filing!