Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

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boglechu
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Joined: Sat Jan 30, 2016 3:19 am

Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

Post by boglechu » Mon Mar 12, 2018 10:32 am

I have an a-Corp. I spent about $5k last year and deducted it from my tax.

Wife works for large company that offers group insurance. They charge her $1500/yr but if I am added on, cost to add me is additional $6000.

Does it mean that I can’t deduct my health insurance?

michaeljc70
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Joined: Thu Oct 15, 2015 3:53 pm

Re: Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

Post by michaeljc70 » Mon Mar 12, 2018 10:56 am

You can deduct your own health insurance from your business (assuming you are not a minority owner <2%). It will be taxed though as compensation on your personal return so take that into account. The plan would have to be established by the business also. That means the business paying the premiums and not you personally and it being reported as W2 compensation.

notmyhand
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Joined: Mon Jul 15, 2013 7:43 pm

Re: Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

Post by notmyhand » Mon Mar 12, 2018 11:02 am

No you can't because likely it is already pretax (does it come out before your wife gets her paycheck?)

michaeljc70
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Re: Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

Post by michaeljc70 » Mon Mar 12, 2018 11:14 am

notmyhand wrote:
Mon Mar 12, 2018 11:02 am
No you can't because likely it is already pretax (does it come out before your wife gets her paycheck?)
As I read the OP, he wants to get his own insurance and not be on his wife's work policy.

notmyhand
Posts: 275
Joined: Mon Jul 15, 2013 7:43 pm

Re: Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

Post by notmyhand » Mon Mar 12, 2018 11:37 am

I misunderstood. So yes the s Corp can deduct it as a part of your wages (included in box 1 of your w2) but you cannot deduct it on your personal so you will still be responsible for taxes on it.

"A 2-percent shareholder-employee is eligible for an above-the-line deduction 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)."

https://www.irs.gov/businesses/small-bu ... nce-issues

techrules
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Re: Deduct cost of health insurance (s-Corp) for officer if wife gets group insurance through employer?

Post by techrules » Mon Mar 12, 2018 11:42 am

I had read a lot into these rules as I was in a similar situation a couple of years ago, I do not think you can deduct your health premiums if you or your spouse is offered a subsidized plan through another employer. You may choose to refuse it, but you will still not be allowed to claim deductions for premiums you paid for yourself.

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