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S Corp health insurance deductions
Q: Our S corporation pays health insurance for all its employees (including me). How do we handle this?
A: The corporation can deduct its payment of premiums on behalf of employees, including you. However, if you own more than 2% of the S corporation, you cannot receive this benefit tax free; the corporation must include this amount as compensation to you on your W–2 form. You can then deduct 100% of this amount on your personal return as an above–the–line deduction.
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