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8. Overhead insurance that pays for busi- ness overhead expenses you have during long periods of disability caused by your injury or sickness. 9. Car and other vehicle insurance that cov- ers vehicles used in your business for lia- bility, damages, and other losses. If you operate a vehicle partly for personal use, deduct only the part of the insurance pre- mium that applies to the business use of the vehicle. If you use the standard mile- age rate to figure your car expenses, you can’t deduct any car insurance premiums. 10. Life insurance covering your officers and employees if you aren’t directly or indi- rectly a beneficiary under the contract. 11. Business interruption insurance that pays for lost profits if your business is shut down due to a fire or other cause. Self-Employed Health Insurance Deduction You may be able to deduct the amount you paid for medical and dental insurance and qualified long-term care insurance for yourself, your spouse, and your dependents. The insurance also can cover your child who was under age 27 at the end of 2018, even if the child wasn’t your dependent. A child includes your son, daughter, stepchild, adopted child, or foster child. A foster child is any child placed with you by an authorized placement agency or by judg- ment, decree, or other order of any court of competent jurisdiction. One of the following statements must be true. • You were self-employed and had a net profit for the year reported on Schedule C (Form 1040), Schedule C-EZ (Form 1040), or Schedule F (Form 1040). • You were a partner with net earnings from self-employment for the year reported on Schedule K-1 (Form 1065), box 14, code A. • You used one of the optional methods to figure your net earnings from self-employ- ment on Schedule SE. • You received wages in 2018 from an S cor- poration in which you were a more-than-2% shareholder. Health insur- ance premiums paid or reimbursed by the S corporation are shown as wages on Form W-2. The insurance plan must be established, or considered to be established as discussed in the following bullets, under your business. • For self-employed individuals filing a Schedule C, C-EZ, or F, a policy can be ei- ther in the name of the business or in the name of the individual. • For partners, a policy can be either in the name of the partnership or in the name of the partner. You can either pay the premi- ums yourself or the partnership can pay them and report the premium amounts on Schedule K-1 (Form 1065) as guaranteed payments to be included in your gross in- come. However, if the policy is in your name and you pay the premiums yourself, the partnership must reimburse you and report the premium amounts on Sched- ule K-1 (Form 1065) as guaranteed pay- ments to be included in your gross income. Otherwise, the insurance plan won’t be considered to be established under your business. • For more-than-2% shareholders, a policy can be either in the name of the S corpora- tion or in the name of the shareholder. You can either pay the premiums yourself or the S corporation can pay them and report the premium amounts on Form W-2 as wa- ges to be included in your gross income. However, if the policy is in your name and you pay the premiums yourself, the S cor- poration must reimburse you and report the premium amounts on Form W-2 in box 1 as wages to be included in your gross income. Otherwise, the insurance plan won’t be considered to be established under your business. Medicare premiums you voluntarily pay to obtain insurance in your name that is similar to qualifying private health insurance can be used to figure the deduction. Amounts paid for health insurance coverage from retirement plan distri- butions that were nontaxable because you are a retired public safety officer can’t be used to fig- ure the deduction. Take the deduction on Schedule 1 (Form 1040), line 29. Qualified long-term care insurance. You can include premiums paid on a qualified long-term care insurance contract when figuring your deduction. But, for each person covered, you can include only the smaller of the following amounts. 1. The amount paid for that person. 2. The amount shown below. Use the per- son's age at the end of the tax year. a. Age 40 or younger–$420 b. Age 41 to 50–$780 c. Age 51 to 60–$1,560 d. Age 61 to 70–$4,160 e. Age 71 or older–$5,200 Qualified long-term care insurance con- tract. A qualified long-term care insurance contract is an insurance contract that only pro- vides coverage of qualified long-term care serv- ices. The contract must meet all the following requirements. • It must be guaranteed renewable. • It must provide that refunds, other than re- funds on the death of the insured or com- plete surrender or cancellation of the con- tract, and dividends under the contract may be used only to reduce future premi- ums or increase future benefits. • It must not provide for a cash surrender value or other money that can be paid, as- signed, pledged, or borrowed. • It generally must not pay or reimburse ex- penses incurred for services or items that would be reimbursed under Medicare, ex- cept where Medicare is a secondary payer or the contract makes per diem or other periodic payments without regard to ex- penses. Qualified long-term care services. Quali- fied long-term care services are: • Necessary diagnostic, preventive, thera- peutic, curing, treating, mitigating, and re- habilitative services; and • Maintenance or personal care services. The services must be required by a chronically ill individual and prescribed by a licensed health care practitioner. Chapter 6 Insurance Page 21