Syverson Introduces Fairness Bill to Extend Health Insurance Tax Deduction to Self-Employed Illinoisans

State Senator Dave Syverson (R-Cherry Valley) is introducing a bill to provide meaningful tax relief to Illinois residents who purchase their health insurance through the Affordable Care Act marketplace.

The legislation, Senate Bill 2763, would allow Illinois taxpayers to deduct the cost of ACA marketplace health insurance premiums and qualified out-of-pocket medical expenses from their state taxable income, reducing the amount they owe in state income taxes.

"This is about fairness," Senator Syverson said. "If state employees and legislators can deduct their health insurance premiums and medical expenses, then the self-employed and hardworking families buying coverage on their own should be able to do the same."

The bill would extend that deduction to Illinoisans who buy coverage on their own, including farmers, dentists, realtors, small business owners, and other self-employed workers who currently do not receive the same tax treatment.

Under current Illinois law, individuals covered under employer-sponsored health plans can deduct their premiums and out-of-pocket medical costs, and the same full deduction applies to state employees and legislators. However, individuals who purchase their own coverage through the ACA marketplace do not receive the same treatment under the state tax code.

The bill has been assigned to the Senate Revenue Committee and now awaits further action.