Schedule K-1, boxes 4a and 4b provide for entry of guaranteed payments made by the partnership to partners. There are two scenarios - guaranteed payments made based on partners services provided and the other based on the partners supply of capital. Under the services category, the partnership may include medical insurance premiums made by the partnership for partners. . My questions is this; is a partnerships reimbursement of Medicare Part B premiums to each partner a guaranteed payment per Box 4a on Schedule K-1? This is an important question because if the answer is yes, each partner gets a medical insurance premium deduction on their individual 1040 return while at the same time the partnerships ordinary business income (Box 1) is reduced. So, is Medicare Part B premium reimbursement by the partnership a qualified medical insurance premium guaranteed payment per Box 4a?
