Recent Updates to Tax Code Haven't Corrected Unfairness for Small Business
While small businesses are able to deduct the costs of healthcare from their annual income, the code still prevents entrepreneurs from deducting these costs from the wage base for self-employment taxes (Social Security and Medicare). This means entrepreneurs are treated differently than Americans who receive their healthcare from a corporation -- they are forced to pay additional taxes simply because they are self-employed. NFIB will continue to fight to ensure that healthcare costs truly are fully deductible for self-employed individuals, as they are for other American workers.
NFIB supports the Health Care Freedom of Choice Act (H.R. 4625), introduced by Rep. Chris Chocola (2nd Dist.-Ind.). This bill would allow individuals to deduct 100 percent of their medical expenses from their taxes, including health insurance premiums. According to an NFIB Member Ballot, nearly 90 percent of NFIB members believe individuals should be able to deduct 100 percent of the cost of health-insurance premiums from their taxes. This may allow some of the 47 million uninsured to purchase health insurance, putting them in control of their own health care.
NFIB is a member of the Coalition Supporting Equity for our Nation's Self-Employed, a coalition of small-business organizations committed to ensuring that self-employed individuals' healthcare costs receive fair and equal treatment by the tax code.
