Single member LLC taxed as s-corp
Reasonable salary paid to owner (me) and reported on W-2 form as wages
The first time that my healthcare coverage premiums were paid for by company
Other tax professionals recommend that for LLC as an S corp, the LLC members are treated as employees and the premiums are reported as part of the W-2 gross wages ("plan is considered established by the business") and then deducted on my personal return - Form 1040, line 10a.
I enter the W-2 wages into TurboTax Business 2020 as shown on my W-2. Call this value X.
Under Federal Taxes - Deductions - Compensation and Benefits - Insurance, health, and other benefits, I enter my health insurance amount total for Officers (just me). Call this value Y.
I am a bit confused as my W-2 form shows my box 1 gross wages as X but TurboTax Business (and the draft K-1 it produced for me to preview) shows my total wages as X+Y.
Right now, TurboTax Business and TurboTax Home and Business 2020 may be viewing my salary as X+Y and might think I owe self employment taxes on X+Y, not just X as noted on the w-2 (the withholding taxes on the w-2 were calculated based on X, not X+Y).
I think that my intention is for X to represent all w-2 income including the health benefits so as not to owe additional SE taxes.
Just a guess: if the above is not the right way for things to be done, maybe I should take off the benefits info added to TurboTax Business so that my total salary matches exactly what's on my official w-2, and then just take the self-employed health insurance deduction on my 1040.
My W-2 compensation is reasonable whether it's X or X+Y but I just want to make sure that TurboTax is accurately showing things so that there are no discrepancies or unexpected taxes owed.
Should I be making any adjustments anywhere? Any recommendations?
