An S-Corporation more then 2% shareholder's health insurance premiums should be reported as wage income on the W-2 form in box 1. That way when the shareholder enters the wages on his or her personal tax return, the taxpayer may be able to deduct the premiums as self-employed health insurance. If they weren't entered as such on a W-2 form, technically they are not deductible by the S Corporation, so they shouldn't be entered on the S corporation tax return.
This is so because the deduction for the premiums is a personal tax issue in that they aren't always deductible. For instance, if the shareholder was eligible to be on the health insurance policy of a spouse, then the shareholder heath insurance would not be deductible. So, you can't deduct it on the S corporation return as it may not be deductible by the shareholder. @davidsimshomes
You don't deduct health insurance premiums as such for a more than 2% shareholder on an S corporation return. You just enter the deduction as a part of officer wages. When you enter your W-2 income on your personal return, that increases your income by the amount of the officer/shareholder insurance premiums. You then deduct them as self-employed health insurance as is allowed on your personal return. Thus the insurance premiums are deducted on the S corporation return as wages, then added as wage income on form 1040, then deducted as self-employed health insurance. So there are two deductions and one add to income, which nets out to one deduction! @June YW
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