If we are talking about medical insurance and life insurance for more than 2% shareholders of an S Corp, then please see the details below. The situation differs for non-shareholder insurances.
- Medical Insurance (Health and Dental) must be included in the shareholders' wages and reported on their W-2. Then, it is claimed as the above-the-line deduction on the shareholder's individual tax return.
- It is not reported on Schedule K-1 directly. Only as an expense that will be incorporated into the net income, which will show up in box 1 of the Schedule K-1.
- Life insurance for a shareholder is not a deductible expense. So, you will not see it as part of the other expenses. However, it needs to be reported on Schedule M-1, line 3b, so that the Accumulated Adjustments Account (AAA) reflects the correct information.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
