Code Section 162(l)
| Code Section | Effective Date | Name of Act | Name of Provision |
|---|---|---|---|
| 162(l) | 12/31/2009 | The Small Business Jobs Act of 2010 | Temporary deduction for health insurance costs in computing self-employment income |
Temporary deduction for health insurance costs in computing self-employment income
Explanation of Provision
Under the provision, the deduction for income tax purposes allowed to self-employed individuals for the cost of health insurance for themselves, their spouses, dependents, and children who have not attained age 27 as of the end of the taxable year is taken into account, and thus also allowed, in calculating net earnings from self-employment for purposes of SECA taxes.
It is intended that earned income within the meaning of section 401(c)(2) be computed without regard to this deduction for the cost of health insurance.[1391] Thus, earned income for purposes of the
limitation applicable to the health insurance deduction is computed without regard to this deduction.
The provision only applies for the taxpayer’s first taxable year beginning after December 31, 2009.
[1391] A technical correction may be necessary so that the statute reflects this intent.
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