Denver, CO (PressExposure) March 22, 2010 -- When you own your own business, you have to face so many realities like taxes and benefits like health insurance. If you are better able to understand the health care situation, it will provide you with a better platform to making a good decision on what to do about insurance.
How Do I Get Insured?
If you just left your corporate job, you have about 18 months extended benefits so that you can plan properly your insurance. Of course, this does not mean your previous employer will continue to pay premiums. You will have to cover for that expense which can be a little costly.
During this 18 months, you can start canvassing for individual health policies for the self-employed. You must consider including your family and your assets in the coverage. It will not be as expensive as you think because you are applying at a time when the business is just started.
There are several insurance companies that will not cover for pre-existing condition, but if you are resourceful enough, you will be able to find those that do. It's all a matter of doing the research. You could ask insurance brokers about the shift from a corporate health plan to a self-employed insurance. Usually, as long as you do not miss a payment during the 18 month extension, you should still be covered according to the corporate health plan.
How Can I Save?
If you want, the health insurance can be a family insurance plan which is less expensive. However, once you start building up your staffing, you will have to shift if you want to give them health benefits.
Can I deduct the health insurance expense in my business?
Fortunately, the self-employed is allowed to use the health insurance plan as an expense in their business. You are allowed to deduct the cost from your taxable income provided it is not more expensive than your income. In other words, you can use it as an expense, but you will not be able to use it as a reason for the low income of your business. As a business, you are treated equally whatever the size of your company. Make sure to talk to a professional accountant about how to go about using the insurance as a deductible.
With health insurance as an added cost, and the fact that as the business owner, you will have to shoulder the bulk of the payments mean that it is always best to plan your policy wisely. Try not to be too ambitious with the plan until your business is on stable ground. Unless you have someone in your family that has a medical condition, and the insurance company agrees to cover some of the costs, then you should stick to the basics. As your company and business grows, you can slowly add to your health insurance plan.