Answer the question(s) for each situation using the Publication 17.

Deduction for Half of Self-Employment Tax / Self-Employed Health Insurance Deduction

An employer is required by law to withhold the additional Medicare tax from wages it pays to individuals in excess of $200,000 in a calendar year. What additional percentage the employer will withhold?

Juan, who is single, is a self-employed carpenter as well as an employee of Frame It, Inc. His self-employment net income is $35,000, and he received a W-2 from Frame It for wages of $25,000. He is covered by his employers pension plan, but his employer does not offer a health plan in which he could participate.

i.Up to how much of his self-employed health insurance premiums could he deduct for this year, if any? Why?

ii.How much of Juans self-employment taxes would be deductible?