Self-employed taxpayers with a net profit for the year may be able to deduct the amount they paid for medical and qualified long-term care insurance for themselves, spouses, dependents, and children under age 27 at the end of the year. Who’s eligible to claim the deduction? Self-employed people and farmers. General partners in a partnership and active members of an LLC with self-employed income. Employees of an S corporation who own at least 2% of the corporation’s stock. The insurance plan must be established under your trade or business and the deduction cannot exceed your earned income from that trade or business. Note that you cannot deduct payments for medical insurance for any month that you were eligible to participate in a health plan subsidized by your or your spouse’s employer.