Business & farm

If you choose to have the partnership "pay" for your health insurance, it is treated as a guaranteed payment only on the partnership side.  You would split the amount by the partnership ownership percentages and then report the Guaranteed Payments to each partner on your Form 1065.  You will then claim the Self-employed Health Insurance Deduction on your personal returns.

To enter your K-1s and claim the Self-employed Health insurance Deduction in TurboTax you can follow these steps:

1. Open your tax return, if you haven't already
2. Select Federal, then Wages & Income (this may show as Wages & Expenses depending on your program)
3. Scroll down and select Show more next to S-Corps, Partnerships, and Trusts
4. Start Schedule K-1
5. On the Did you receive any Schedules K-1? screen, select Yes
6. Select Start next to Partnerships/LLCs (Form 1065)
7. On the Partnership Name and Address screen, enter the info and select Continue
8. Continue entering your info
9. Once you get to the Check Boxes That Have an Amount screen, your K-1 should have an amount for Self-Employment Income and, if your partnership paid for the SEHI, an amount for box 13 with a code M.
10. You may have any number of other boxes that have amounts listed, as well
11. Once you have completed the entry of your box 13 code M (if applicable) and box 14 (required for a SEHI deduction), select Continue
12. Enter any remaining info for the other boxes on your K-1
13. On the Describe the Partnership screen, if you paid your own insurance premiums, check the box next to I personally paid health insurance and/or long-term care insurance premiums for myself and my family
14. If you checked the above box, you’ll see the Unreimbursed Partnership Expenses screen, Select Yes
15. Continue through the screens until you reach the screen for Any Self-Employed Insurance Costs? Enter any amounts you paid personally on these screens

Once you’ve completed your Schedule K-1 entry, your premium amounts will show as a Self-Employed Health Insurance Deduction on Schedule 1, line 17.

Note: Your deduction for SEHI may be limited by the amount of the self-employed income reported by the partnership (less the self-employment tax on that income).