That's what I thought too because I read the same section of that IRS publication.

To answer your questions:

I think they got it wrong to the tune of the full $9k. Box 1, 3 and 5 of the W2 are the exact same dollar amount which shouldn't be. 

When I said additional information, I was really referring to Box 17 other information and the related supporting schedule that explains what what in that box. In Box 17 there is code "AD". When you look at the detail pages for explanation, AD is explained as ""medical insurance premiums for more than 2% shareholders" and the amount is $9k.

Again, my client insists what shown on W2 is his normal compensation and does not include health insurance premium and he seems to be right based on the fact that boxes 1, 3 and 5 of the W2 are the same.

What you are saying is they screwed up his K-1 and possibly the 1120S altogether, correct? I have talked to the S Corp filer accountant before and he is a little defensive. How would you handle this and still report on time?