Private Health Insurance Direct Answers

What are the health insurance options for the self-employed?

The self-employed typically buy an individual ACA-compliant private health plan off-exchange or on-exchange, and if they have net self-employment income they can deduct the premium above the line under the self-employed health insurance deduction (IRS Publication 535).

What the government has said, on the record

“Use Form 7206 to determine any amount of the self-employed health insurance deduction you may be able to report on Schedule 1 (Form 1040), line 17.”

— Internal Revenue Service, Internal Revenue Service (U.S. Department of the Treasury), IRS Instructions for Form 7206, Self-Employed Health Insurance Deduction, 2025-01-01 (source)

Editor’s note

From the official IRS instructions for Form 7206. Line references and dollar thresholds change by tax year — verify against the current-year form, and consult a tax professional for your situation.

Who said this

Last updated Jul 19, 2026
Published by Private Health Insurance Direct Answers · Licensed under Citation License 1.0

What it means

  • Self-employed workers are treated as individual buyers, not group buyers.
  • They can choose a PPO, HMO, EPO, POS, or HSA-eligible HDHP directly from a carrier.
  • The self-employed health insurance deduction reduces adjusted gross income for the premium paid for you, your spouse, and dependents.

Action steps

  1. Confirm you have net self-employment profit for the year the premium is paid.
  2. Keep monthly premium statements and 1095-B/1095-A forms for your tax preparer.
  3. Consider an HSA-eligible HDHP if you want to shelter income and pay medical costs with pre-tax dollars.

Risks & deadlines

  • The deduction cannot exceed your net self-employment earnings.
  • You cannot take the deduction for any month you were eligible for employer-subsidized coverage through a spouse.

Also asked as

  • self employed health insurance options
  • best health insurance for self employed

Source:

Last verified: 2026-07-19

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