Question

David, a sole proprietor of a bookstore, pays a $7,500 premium for medi- cal insurance for him and his family. Joan, an employee of a small firm that doesn't provide her with medical insurance, pays medical insurance premiums of $8,000 for herself. How does the tax treatment differ for david and joan

Answer 1

Answer:

Since David is self employed the insurance premiums are a business expense deduction, deduction for AGI. Joan’s medical premiums are also deductible but is subject to the AGI floor.

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