President Clinton has signed legislation allowing the self-employed to deduct part of the cost of their health insurance.
"I did it because tax day is April 17, and these people are getting their records ready, and there are millions of them, and they are entitled to this deduction," Clinton said Tuesday. "It was wrong for it ever to expire in the first place."The law restores a provision to the tax code whereby some 3.2 million people can claim a 25 percent deduction for health insurance premiums they paid in 1994. The benefit will increase permanently to 30 percent this year.
Clinton said he favors increasing the deduction to 100 percent.
"Increasing the amount of the deduction will make health insurance more affordable for self-employed small-business people who are today paying some of the highest insurance premiums in the nation," Clinton said.
The self-employed can claim the insurance deduction for 1994 on line 26 of Form 1040. Taxpayers who have already filed returns but did not claim the deduction can file an amended return.