Scattered throughout the tax code so widely and in highly technical language are obscure loopholes that allow self-employed business owners tax deductions that can add up to as much as $25,000 annually. For doctors who are self-employed, or for doctors whose spouses are self-employed, this presents a significant tax opportunity that is almost always overlooked.    In a 1994 private letter ruling, the IRS allowed a self-employed professional to hire his/her spouse as an employee and provide medical insurance to the spouse and the spouse's dependants as an employee benefit, 100% tax deductible and at no tax cost to the employee/spouse. One significant requirement: a contract between employer and employee/spouse must be in place beforehand to document and define the employer's contractual obligations and the employee's job responsibilities.    Using an SEC, medical insurance benefits are just the beginning. Bear in mind that this is not a do-it-yourself tax program where one puts a spouse on the books and starts writing everything off. The SEC documents the relationship, responsibilities, compensation and extensive employee benefits. Without the contract, this kind of arrangement isn't legal and won't work. But with it, the tax savings are impressive.    For doctors, SEC works in two different modes. For those who are self-employed, it is an opportunity to hire your spouse and provide benefits that become 100% tax deductible. Physicians who operate as a PC or a Sub S corporation can't use the SEC - but their self-employed spouses can.    Let's say a physician's spouse has an interior design business. The spouse can hire the doctor as employee - regardless of the doctor's own work status - and use the SEC to provide the doctor with benefits, which become 100% tax deductible. Here are some of the deductions, big and small, made possible with the SEC: The Big Stuff:    Medical insurance is worth about $6,000 annually, but that doesn't include the value of all other medical costs for an employee and dependants. You can offer your employee and dependants both medical insurance and non-covered medical costs as health care benefits.     Big companies have on-site athletic facilities for employees - and they are equally valuable for small companies. This can feature big items like exercise equipment or a swimming pool or small ones like a bat and a glove.    Almost every home business has an electronic security system, but most owners only deduct the pro-rata portion, which is correct, but only covers a small fraction. A business with an SEC employee can have the business pay for the entire home security system - installation, maintenance, service, etc. - as an employee benefit - and is allowed to write off 100% of the cost. The Small Stuff, or "De minimus"    These are items that the IRS considers too small to ask any business taxpayer to account for, regardless of the company's size. But what's small for a big corporation adds up fast for a self-employed practice. Examples: Food:Coffee, juices, snacks and other food items that an office might typically offer to employees. Occasional supper money: This can be reimbursed or provided in kind for SEC employees to enable him/her to work overtime. Note that this is NOT entertainment, which is only 50% tax deductible, but an employee fringe benefit: 100% deductible. Occasional entertainment: Tickets to theater, sporting events, comedy clubs, concerts, are a fringe benefit, just as an employer in a big firm would buy season tickets and give them to employees. Transportation and dinner are usually included. Holiday and birthday gifts and parties: Traditional holiday gifts of property with a low fair market value are fair game for SEC employee fringe benefits. Birthday gifts are also fully tax deductible, whatever the gift might be.