Yes and No. Any personal expenditures paid by a corporation on behalf of its CEO becomes compensation reportable on the W-2 form. Since the corporation is a "C" corp, make sure the loan payments don't cause any "excess compensation". Excess compensation becomes non-deductible constructive dividends. My recommendation is to increase the CEO's wages and have the loan payments paid from the CEO's personal checking account. No reason to commingle funds. Just make sure the total wages are reasonable.
https://www.thetaxadviser.com/issues/2017/may/identifying-constructive-dividends-shareholders.html
Payments made to others for the personal benefit of the shareholder: Payment by a corporation of expenses of a shareholder without expectation of repayment can result in constructive dividends (Estate of Sell, T.C. Memo. 1992-430; Gow, T.C. Memo. 2000-93, aff'd, 19 Fed. Appx. 90 (4th Cir. 2001)). Such dividends are income to the shareholder but are not deductible by the corporation. Corporate payments for shareholder expenses have also been deemed to be additional compensation to shareholders (Ghosn, T.C. Memo. 1995-192).
If the corporation is paying a shareholder's expenses, the shareholder and the corporation should determine if the corporation could treat the payments as compensation that it can deduct. However, treatment of the payments as compensation subjects them to payroll taxes. Alternatively, the shareholder could set up the payments as a valid loan. In that instance, the corporation could not deduct the payments, but the shareholder would not report them as income.
Excessive compensation: Amounts paid to a shareholder in excess of what is considered reasonable may give rise to a constructive dividend. This may include not just salary but also directors' fees.
