Treating Medical Insurance Premiums as Wages
Health and accident insurance premiums paid on behalf of a greater than 2-percent S corporation shareholder-employee are deductible by the S corporation and reportable as wages on the shareholder-employee’s Form W-2, subject to income tax withholding.
However, these additional wages are not subject to Social Security, or Medicare (FICA), or Unemployment (FUTA) taxes if the payments of premiums are made to or on behalf of an employee under a plan or system that makes provision for all or a class of employees (or employees and their dependents). Therefore, the additional compensation is included in the shareholder-employee’s Box 1 (Wages) of Form W-2, Wage and Tax Statement, but is not included in Boxes 3 and 5 of Form W-2.
A 2-percent shareholder-employee is eligible for an above-the-line deduction # 29 1040 in arriving at Adjusted Gross Income (AGI)
for amounts paid during the year for medical care premiums if the medical care coverage was established by the S corporation and the shareholder met the other self-employed medical insurance deduction requirements. If, however, the shareholder or the shareholder’s spouse was eligible to participate in any subsidized health care plan, then the shareholder is not entitled to the above-the-line deduction. IRC § 162(l). Self Employed
IRS Page on this very question.
IRS Site on what forms S Corps have to fill out
AB 1672 – (1992 to 2013) Small Group Health Rules prior to Obamacare
Health Insurance Deduction Line 29 for self employed
Schedule C – Line 12 Biz Income or Loss, Line 29 Health Insurance Premiums, Line 37 Adjusted Gross Income, MAGI Income
Webmaster Tool Keywords
self employed health insurance deduction self employed health insurance self employed health insurance premiums self employed medical insurance group health insurance for self employed self employed insurance deduction self employment health insurance health insurance self employed health insurance deduction self employed self employment health insurance deduction self employment insurance deduction 1040 line 29 self employment insurance health insurance deduction for self employed irs self employed health insurance deduction is health insurance deductible for self employed self employed health insurance tax deduction self employed health plans self-employed health insurance is health insurance tax deductible for self employed california self-employed health insurance self-employed health insurance california line 29 1040 self employed health insurance california self employed health insurance deduction worksheet health insurance for self-employed schedule a line 29 health insurance for self employed