QUESTION: I own and run a closely held business and I purchase my health insurance under my own healthcare plan. My 25 year old daughter, who lives in Chicago, lost her job. Until she finds another job with health insurance, can I cover her in my healthcare plan and also deduct the cost of her coverage?
ANSWER: Yes. Under the 2010 Reconciliation Act, a child under age 27 need not meet the dependency tests for coverage. Thus, your child is eligible for coverage (and you receive the deduction) regardless of your daughter’s abode, your daughter’s tax filing status, or who supplies support for your daughter.
Feel free to contact me if you or someone you know has this type of situation. Financial Planning and tax planning advice presented here is general in nature, and individual circumstances make applying these general rules tricky; thus, the above answer cannot be applied to all circumstances because the slightest variation could cause a different outcome.
The Weekly Commentary
Observations of the current state of the stock and bond markets
