Updated October 18, 2026. Quick answer: The Self-Employed Health Insurance Deduction Worksheet figures the amount of health insurance premiums you can deduct on Schedule 1, line 17. It is three lines: the premiums you paid, your net profit and other earned income from the business, and the smaller of the two. Some filers use Form 7206 or Pub. 974 instead.
What this worksheet is for
The line 17 instructions open: “You may be able to deduct the amount you paid for health insurance”. They set a condition: “One of the following statements must be true.” One of the listed statements is that you were self-employed and “had a net profit for the year reported on Schedule C or F.” They then say “If you qualify to take the deduction, use the Self-Employed Health Insurance Deduction Worksheet to figure the amount you can deduct.”
Three situations call for a different form: “Use Form 7206 instead of the Self-Employed Health Insurance Deduction Worksheet in these instructions to figure your deduction if any of the following applies.” The list includes “You file Form 2555.” and “You are using amounts paid for qualified long-term care insurance to figure the deduction.” Marketplace coverage has its own rule: “Use Pub. 974 instead of the worksheet in these instructions if the insurance plan was considered to be established under your business and was obtained through the Marketplace”. The deduction is explained at Schedule 1 line 17.
The worksheet line by line
Each right-hand cell is the worksheet’s own wording for that line.
| Line | What the worksheet says |
|---|---|
| 1 | “Enter the total amount paid in 2025 for health insurance coverage established under your business” “But don’t include amounts for any month you were eligible to participate in” an employer-sponsored health plan. |
| 2 | “Enter your net profit” and any other earned income from the business, “minus any deductions on Schedule 1, lines 15 and 16.” “Don’t include Conservation Reserve Program payments” |
| 3 | “Enter the smaller of line 1 or line 2 here and on Schedule 1, line 17.” “Don’t include this amount in figuring any medical expense deduction on Schedule A” |
Two footnotes matter for line 2. On the optional methods: “don’t enter your net profit. Instead, enter the amount from Schedule SE, line 4b.” On what counts as earned income: “Earned income includes net earnings and gains from the sale, transfer, or licensing of property you created.” “However, it doesn’t include capital gain income.”
A worked example
This is an illustration, not an IRS example. All amounts are invented.
| Worksheet step | Invented amount | How it is reached |
|---|---|---|
| Line 1 (premiums paid for 2025) | $9,000 | Invented input |
| Line 2 (net profit and earned income, less Schedule 1 lines 15 and 16) | $27,500 (computed) | Invented: 30,000 minus 2,500 |
| Line 3 (smaller of line 1 and line 2) | $9,000 (computed) | smaller of 9,000 and 27,500 |
| Second case: line 2 only | $6,000 | Invented: suppose lines 1 and 2 are 9,000 and 6,000 |
| Second case: line 3 | $6,000 (computed) | smaller of 9,000 and 6,000 |
The deduction is capped by line 2, so it can be smaller than the premiums you paid. In the first case the premiums are the smaller number, so line 3 equals line 1. In the second case the business earned less than the premiums, so line 3 equals line 2. The remaining premiums are not deducted on this worksheet.
Where the number comes from
Line 1 comes from your own records of premiums, and the instructions say which coverage counts: the instructions describe it as covering “medical, dental, and vision insurance”, and they add that “Medicare premiums you voluntarily pay to obtain insurance in your name that is similar to qualifying private health insurance can be used to figure the deduction.” Line 2 draws on the net profit from your business and on the deductions you already figured on Schedule 1 lines 15 and 16. The instructions say these must be taken out: “minus any deductions on Schedule 1, lines 15 and 16.”
Where it goes next
Line 3 is captioned “Enter the smaller of line 1 or line 2 here and on Schedule 1, line 17.” Schedule 1 is covered at Schedule 1 (Form 1040), and its adjustments feed Form 1040. See Form 1040 line by line for the full path.
Edition and line numbers
This page reads the 2025 Instructions for Form 1040 and 1040-SR, the current file irs.gov served on 2026-10-18. It is byte-identical to the archived copy, and the worksheet is the one for the tax year 2025 return, filed in 2026. Check the tax year printed on the worksheet in your own instructions and use that year’s line numbers, because a different year’s worksheet can number or word its lines differently. The other worksheets in the booklet are collected at Form 1040 worksheets.
Common mistakes
- Deducting more than your business earned. Line 3 says “Enter the smaller of line 1 or line 2 here and on Schedule 1, line 17.”
- Counting the same premiums as a medical expense. The worksheet says “Don’t include this amount in figuring any medical expense deduction on Schedule A”
- Using this worksheet when Form 7206 applies. One listed case for Form 7206 is “You file Form 2555.”
Related: Schedule 1 line 17, Schedule 1 lines 15 and 16, Schedule 1 (Form 1040), and Form 1040 line by line.
Sources
- Instructions for Form 1040 and 1040-SR (2025): https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
- Form 1040 (2025): https://www.irs.gov/pub/irs-pdf/f1040.pdf
- Schedule 1 (Form 1040), Additional Income and Adjustments to Income (2025): https://www.irs.gov/pub/irs-pdf/f1040s1.pdf
Read from the IRS documents linked above on October 18, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.