Insurance, health, and other benefits is $0

[douglasl5765]

I am entering health insurance and then upon saving, the amount is $0

[JotikaT2]

Can you clarify what section you are entering this information for.  Is it for a self-employed business or is this on your personal return?

Assuming you are trying to enter this as a personal medical expense, the deduction is limited to qualified medical expenses which exceed 7.5% of your Adjusted Gross Income. 

In TurboTax, you can enter your medical expenses in the Federal section of the program. 

1. Select Deductions & Credits 
2. Select Medical 

Please comment with a more specific question so we can assist you as it applies to your specific situation.

[douglasl5765]

Hi there

Thank you for replying and I will now try to be more specific.

1. I am using the desktop version for businesses to file form 1120-S.

2. On the deductions page where one enters expenses, there is an option to enter Insurance, health, and other benefits.

3. Upon clicking the edit button to get to a new page, i enter the medical insurance amount that my company paid for 2020 medical insurance payments.

4. I click done.

5. Back at the main deductions page where it shows ALL deductions, the amount for insurance remains at $0 - it is like the program is not saving the amount.

[ThomasM125]

The would normally be considered an employee benefit program, and as such appear on line 18 of your form 1120-S, page one.

[douglasl5765]

Thank you but i do not think i am making myself clear.  I will attach pics and that may help.  When i am entering the on the Turbo Tax screen, it is not saving the data.

take a look at the pics and you will see the summary deduction screen shows as $0 and the detail has a number - therefore i can only assume the data from the detail screen is not saving to the summary screen.

i suppose i will preview the forms and maybe on the forms it is there.

[BillM223]

Medical insurance for a 2% or more owner of an 1120-S is not listed as a "insurance, health, and other benefits" - I believe this line is reserved for "normal employees" which the 2% or more owner is not.

Instead, the medical premiums paid on behalf of the 2% or more owner is added to Wages in Box 1 of the 2% or more owner's W-2. (Note: it is not added to Boxes 3 or 5, because medical and hospitalization expenses - which health insurance is - are not subject to FICA taxes). So, as I remember, the health insurance premiums of the 2% or more owner are added to Salary and wages (you might check that).

Then, on your 1040 return, the 2% or more owner is able to take the self-employed health insurance above-the-line deduction on line 16 of Schedule 1 (1040).

So you get the benefit, just not the way you'd expect.

[netgreen]

I'm having the same issue with Turbotax 2021 Business version.

The issue is not with the owner getting the credit on his personal 1040; the problem is that the S-Corp can't deduct this expense due to what appears to be a bug in the software.  My company pays my Medicare  premiums, which I WAS able to deduct using this same screen in the 2020 version.  But now, no matter if I put the amount under the Officers or Shareholders column, it always shows $0 after I save it - the same as the other user experienced a year ago.

[netgreen]

I just figured out what TurboTax is doing: I tried entering the Medicare expenses as part of the Officer's Salary & Wages Paid, but when I saved it the total was higher than what I had entered.  What is happening is that the amount you enter in the Medical Insurance field is actually being added to the amount that is shown for the Salaries & Wages Paid section - but you can't see it if you go in to that section!

[DawnC]

Can you check and clarify something for me @netgreen?    When you click Update next to Insurance, health, and other benefits - If you right click on the amount entry field and click on Add Supporting Detail, another entry box (supporting details) opens.   Is there anything on the supporting details for that category?   Or is there anything on the Salaries and Wages supporting details worksheet after you try to enter an amount for medical?   

If you enter the medical expenses on the supporting details page instead of in the entry box for the total, does the expense stay on the correct line? 

[netgreen]

The answer to all of your questions is NO.  Nothing shows in the "Add Supporting Details" box in either place, and if I add a line for that expense in that box it does not change the amount shown on the summary page.  The overall totals remain the same for both areas.

[ThomasM125]

@netgreen Medical insurance premiums for a more than 2% S corporation shareholder are not deductible as such, that is why they don't show as a medical premiums deduction on your 1120-S tax return.  They are considered compensation to the shareholder if paid by the company, as they are a benefit. 

The more than 2% shareholder can deduct the premiums as self-employed health insurance on their personal form 1040, but only if included in the shareholder's wages.

Thus, the corporation deducts the premiums as wages, the shareholder picks the wages up as income, then deducts the premiums through self-employed health insurance deduction.

Also, the wages reported on the W-2 in box 1 for 2% shareholder health insurance premiums are not included in box 3 or 5 and are not subject to social security tax.