The health insurance premiums paid by the S corporation are reported on Form W-2, Box 14 S. This is the amount the shareholder deducts on page 1 of Form 1040, line 29 (Self- employed health insurance deduction)

Does 2 shareholder health insurance include dental and vision?

For purposes of this memo “health insurance” includes premiums paid for health, dental, vision, long-term care and HSA contributions made by the corporation on behalf of the 2% or more shareholder (and any payments made on behalf of related parties e.g. spouse and children of 2% shareholder).

Can my S corp pay my medical bills?

You can get reimbursed for Medical Expenses! This is a major benefit of having reasonable compensation through your corporation. This benefit to S-Corp owners is accomplished by utilizing a Health Reimbursement Arrangement (HRA ).

Who is considered a 2% shareholder?

(A 2-percent shareholder is someone who owns more than 2 percent of the outstanding stock of the corporation or stock possessing more than 2 percent of the total combined voting power of all stock of the corporation.)

Is dental insurance part of shareholder health insurance?

Shareholders who own more than 2 percent of an S corp should have their premiums tracked separately. These premiums (for health, dental and vision) cannot be deducted by the S corp. The corporation must pay the premiums for the shareholder even if that payment is made as a reimbursement.

Is 2% shareholder health insurance a fringe benefit?

Certain otherwise excludable fringe benefit items are required to be included as taxable wages when provided to a 2% S Corporation shareholder. These fringe benefits are generally excluded from the income of other employees but are taxable to 2% S corporation shareholders similar to partners.

Are Life Insurance shareholders deductible?

For C Corporations, premiums aren’t a deductible expense if shareholders have policies through the company and the company is the beneficiary. In this situation, the life insurance benefit is also a taxable fringe benefit. They fall under the same considerations as individual policies.

What can an S-Corp write off?

S-Corp Tax Deductions Ordinary business expenses such as rent, taxes, advertising, company-provided employee benefits, depreciation and interest can be subtracted from profits and income to arrive at the net income for the business. If this net income is negative, it is passed through to shareholders as a deduction.