HEALTH INSURANCE: Small Businesses Win Modest Deduction
The omnibus budget agreement due for a vote today will likely include a provision allowing small business owners to deduct 60% of the costs of their health insurance premiums from their federal tax returns, a modest increase from the 45% allowed in 1998. The move disappointed many small business owners, who intensely lobbied congressional budget negotiators for full deductibility. The deduction will increase to 70% in 2002 and reach full deductibility by 2003, four years earlier than the 2007 deadline set by Congress last year. But "Small business owners can't wait until 2003 to be sick," said David D'Onofrio, director of government affairs for National Small Business United, who added, "[W]e're going to continue to push for immediate 100% deductibility next year" (Dickerson, Los Angeles Times, 10/21).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.