S-Corp Health- Added to Gross Income - Taxable??
I am the owner of an S-Corporation. My W-2 shows my gross incomes as total of my wages plus S-Corp Health minus 401K deferral.
My company has been paying for my health insurance premiums and there was no deductions from my paycheck.
Will my S-Corp health be taxable (As, on my gross wages )?
Please note that the business deducts the cost of the health insurance as an expense
As a more than 2% owner of an S corporation, your health insurance premiums are not deductible by the corporation, at least not as insurance or fringe benefits.
Rather, the premiums are added to your gross pay and are deducted as officer salary on the 1120S. The premiums should be included on your 941 returns, and your W-2. They are not, however, subject to fica or futa taxes.
The total federal wages on your W-2, which includes the premiums, are entered as wages on line 7 of your 1040. Assuming you have fica wages at least equal to the insurance premiums, you then claim the self-employed health insurance deduction on your 1040 for the amount of the premiums.
