KY Sch M on ATX

[Randall]

For any KY preparers, I see that the SE health insurance deduction from 1040 automatically carries forward to an addition on KY Schedule M, but does not automatically carry forward to a deduction on KY Schedule M. Did I miss something in KY tax changes? I'm thinking it is still deductible. I think last year, it automatically carried forward to KY Sch M as both an addition and a deduction.

[kcjenkins]

From the instructions for KY Sch M:

Line 2—Enter the self-employed health insurance deduction

from federal Form 1040, Line 29

Line 14, Health Insurance Premiums—Enter medical and

dental insurance premiums paid for yourself, your spouse

and your dependents. This deduction applies to premiums

paid with after-tax dollars. Note:You cannot deduct on Line 14

insurance premiums paid with pretax dollars (cafeteria plans

and vouchers already excluded from wage income) because

the premiums are not included in box 1 of your W-2 form(s).

Do not include long-term care insurance premiums included

on Schedule M, Line 13. You may not deduct premiums paid

on your behalf (advance payments) and you must reduce

the amount you paid by the amount of health coverage tax

credit. (See federal Form 8885.)

So I assume the reason the line 14 entry is not automatic is so that you will check for the exceptions listed above.

KY has a very nice chart, on page 9 of the instructions, that shows the differences between Fed treatment and KY treatment.

[Randall]

Yes, I'm familiar with all that but was curious why it didn't automatically link this year but did last year. I agree, the probable answer is so that we would review the insurance being eligible for the deduction.

[gfizer]

Yes, I'm familiar with all that but was curious why it didn't automatically link this year but did last year. I agree, the probable answer is so that we would review the insurance being eligible for the deduction.

I'm having the same problem. I really think it's a program glitch.

[kcjenkins]

I don't consider it a glitch when the rules make it clear that not all of the additions are going to also be deductions. In that situation, it's OUR JOB to decide whether the item meets the test to be deductible.

[Randall]

I don't consider it a glitch when the rules make it clear that not all of the additions are going to also be deductions. In that situation, it's OUR JOB to decide whether the item meets the test to be deductible.

Another thought I had, how can it be a deduction on Fed 1040 if it were pre-tax dollars? So it seems it would be a deduction on KY if it were on 1040, line 29. I'm trying to think of a situation where the two would differ.