Can self-employed hairdresser deduct health insurance premiums when spouse receives stipend?

This is a good question about self-employed health insurance deductions when there's employer involvement. Based on your situation, here's what you need to know: When your husband receives a stipend (which is taxable income to him) and you use that to purchase a marketplace plan, you may be eligible to deduct a portion of the premiums as self-employed health insurance. The key factor is that you can only deduct premiums that you pay with after-tax dollars. Since the stipend is included in your husband's taxable income, the premiums paid with that money are technically paid with after-tax dollars. However, you can only deduct the portion that covers you and your children, not your husband's portion. You'll need to determine what percentage of the premium goes toward your and your children's coverage versus your husband's. Also important: you can only deduct premiums up to the amount of your net self-employment income. If your hairdressing business doesn't show enough profit, that will limit your deduction.

After struggling with a similar self-employed health insurance situation last year, I found an amazing tool that saved me hours of research and probably kept me from making a costly mistake. I used https://taxr.ai to analyze my specific situation with the marketplace plan and my husband's employer stipend. The tool basically looked at all my tax documents and clarified exactly what portion of our health insurance premiums I could deduct as a self-employed person. It even helped me understand how to properly document the stipend part since that was coming through my husband's employment. I was surprised how much more I could actually deduct than what I initially thought based on my own research! Definitely worth checking out if you're dealing with these complicated self-employment deduction questions.

Just wanted to follow up and say I tried that https://taxr.ai site and it was super helpful! I was skeptical at first (I'm usually terrible with technology), but it actually walked me through everything step by step. Turns out I could deduct about 70% of my family's health insurance premiums as a self-employed person, even though my husband's employer provides that stipend. The tool explained that since the stipend is included as taxable income on my husband's W-2, we're essentially paying with after-tax dollars. It also helped me understand how to document everything properly so I don't trigger an audit. Definitely using this again next year!

If you're having trouble getting clear answers about your self-employed health insurance deduction, you might want to call the IRS directly. I know that sounds like a nightmare (endless hold times), but I found a service called https://claimyr.com that got me through to an actual IRS agent in under 20 minutes instead of waiting for hours. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was struggling with a similar self-employment health insurance question last year (my spouse gets coverage through work but I'm self-employed). The IRS agent walked me through exactly what documentation I needed and how to calculate the deduction correctly. It saved me from making a mistake that would have cost hundreds in missed deductions.

I have to admit I was wrong about Claimyr being a scam. After my skeptical comment, I decided to try it myself since I had some questions about my self-employed health insurance deduction that were driving me crazy. It actually worked exactly as advertised - I got through to an IRS agent in about 12 minutes instead of the 2+ hour wait I experienced last time I called. The agent confirmed that I CAN deduct the portion of health insurance that covers me and my kids as a self-employed person, even though my spouse's employer provides a stipend (as long as that stipend is included in taxable income). She also explained exactly how to document it and where to report it on my Schedule C. Definitely worth it just for the time saved and peace of mind knowing I'm doing it right.

Just FYI - I'm a hairdresser too and have been self-employed for 15+ years. The health insurance deduction for self-employed people is one of the BEST tax benefits we have! Don't miss out on it. One thing nobody mentioned: the deduction doesn't go on Schedule C. You actually take it as an adjustment to income on Schedule 1 of your 1040 (line 16). This is better than a business expense because it reduces your adjusted gross income! Also, make sure you're tracking all your other legitimate business expenses - products, tools, continuing education, booth rental, etc. So many stylists leave money on the table by not keeping good records.

Has anyone here actually been audited over the self-employed health insurance deduction? My tax guy said its one of the things the IRS looks at closely for self-employed people and now im paranoid about claiming it. But its a HUGE deduction for me since my premiums are almost $1400/month for my family!