A self-employed taxpayer may be eligible to deduct amounts paid for medical insurance for themselves and for their families, as long as neither they nor their spouse were eligible for employer-sponsored health insurance. To claim this deduction, a qualifying taxpayer should:

Claim a nonrefundable tax credit based on the cost of the insurance.

Deduct the cost of the health insurance premiums as a business expense on Schedule C.

Only deduct the health insurance costs on Schedule A if they itemize their deductions.

Report the health insurance costs, up to the amount of net business income, as an adjustment to income on Schedule 1 and on Form 1040.