Good evening,
I was a +2% owner of an S Corp which paid Health Insurance premiums for our family, and thus enabled us to take the above-the-line deductions, with the amounts being added to wages in box 1 (and also box 16 for state). However, I'm finding that this is dramatically increasing tax due in North Carolina, and I feel I must be missing something somewhere that is necessary for NC to recognize that the extra wages in boxes 1 and 16 relates to the Health Insurance. Is there some place for NC or Federal in TurboTax that I'm missing a credit or deduction for the premiums paid by the S Corp (as a +2% shareholder)? Federally, it lowers the tax due by the expected amount, but state has the tax increased by ~$1300 compared to the amount of wages minus the premium amount (box 16 minus the premiums).
Any help is appreciated, even if it's to tell me that this is expected.
Michael