Self-Employed Health Insurance Deduction in Texas
Self-employed individuals in Texas can deduct 100% of health, dental, and qualifying long-term care insurance premiums paid for themselves and their families as an above-the-line deduction on their 2025 federal return. This deduction lowers federal adjusted gross income directly, providing meaningful tax relief for freelancers, independent contractors, and small business owners who purchase their own coverage.
Texas has no state income tax, so the self-employed health insurance deduction operates entirely at the federal level for Texas residents. This simplifies the tax picture considerably, as there is no state conformity issue to navigate and the full federal benefit is the only calculation that matters for income tax purposes.
Eligibility requires that the taxpayer is not able to participate in a subsidized health plan through an employer or a spouse's employer. Premiums paid for a spouse, dependents, and children under 27 are also deductible. Texas self-employed filers should retain annual insurance statements and any marketplace enrollment records as documentation when claiming this deduction.