Question

Juan, who is single, is a self-employed carpenter as well as an employee of Frame It, Inc. His self-employment net income is $33,025, and he received a W-2 from Frame It for wages of $23,250. He is covered by his employer's pension plan, but his employer does not offer a health plan in which he could participate.

Answer 1

Juan, who is single, is a self-employed carpenter as well as an employee of Frame It, Inc. His self-employment net income is $33,025, and he received a W-2 from Frame It for wages of $23,250. He is covered by his employer's pension plan, but his employer does not offer a health plan in which he could participate.

a) up to how much of his self employed health insurance premiums could he deduct for this year, if any? why?

b) how much of Juan’s self employment taxes would be deductible

Explanation:

a) Juan can deduct up to 100 of his self-employed health insurance premiums, the two possibilities of regards to this deduction, the only limitation that applies to Juan is that he can deduct premiums only up to $33,025. which is from his net business income. self employment

b) Juan can deduct 50% of his self employment taxes as an above the line deduction