Mike and Rose Are Married and File Jointly $$\begin{array} { l r } \text { Family heal th insurance } & \$ 9,500 \\\text { Family dental insurance } & 1,000\end{array}$$

question 109

Essay

Mike and Rose are married and file jointly. Mike earns $45,000 from wages and Rose reports $450 on her Schedule C as an artist. Since Mike's work does not offer health insurance, Rose pays the following health insurance premiums from her business account: $$\begin{array} { l r } \text { Family heal th insurance } & \$ 9,500 \\\text { Family dental insurance } & 1,000\end{array}$$ How much can Mike and Rose deduct as self-employed health insurance?

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Definitions:

Purchases Returns and Allowances

Transactions where a buyer returns goods to the supplier or receives a reduction in the purchase price, reducing the amount owed to the supplier.

Merchandise Inventory

The goods a company holds for the purpose of selling to customers.

Periodic Inventory System

A method of tracking inventory where physical counts are conducted at certain intervals to determine the level of inventory and the cost of goods sold.

Cost of Sale

The direct costs attributed to the production of the goods sold by a company.