S corp. non owner attribution rules for self-employed health insurance

[johnoc]

Health Insurance paid for family members (even though not owners) of S Corp. must be included in family members W-2 as federal gross wages (and State gross wages). Health Insurance Plan must be a S Corp. health insurance plan. 

IRS Chief Counsel provided guidance on this in 201912001 dated 3-22-2019

I see some guidance in general in Pub. 15-A.

IRS Chief Counsel guidance indicates family member also get an adjusted gross income deduction for self-employed health insurance on form 1040.

Quick Books has mechanics in the payroll program to complete this process correctly.

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[qbteachmt]

You haven't stated what you want help doing, or which form this pertains to, or any details, really. Yes, it is a consideration. How does that apply to what you are asking from your peer users?

[johnoc]

Looking for general consensus about the reporting issues.

I see some other comments ask about how the non-owner S corp. taxpayer receiving the extra gross income from the health insurance would deduct this item if the non-owner does not receive a K-1.

Creating a mock K-1 was suggested? Not sure that's a good idea and might create IRS letter correspondence to deal with.

thanks for responding. I do need to be a lot more specific in where I was headed/

[qbteachmt]

"I see some other comments ask about how the non-owner S corp. taxpayer receiving the extra gross income from the health insurance would deduct this item if the non-owner does not receive a K-1."

It should be on their W2 with the proper benefit code.

[johnoc]

It is included on the W-2 as federal wages with proper benefit code. The question remains how to deduct on the 1040 since the non-owner does not receive a K-1.

Not seeing an explanation in the 1040 instructions?

Mockup K-1 or other?

[TaxGuyBill]

The software will only do it with a K-1 or a direct override.

So I would enter a 'mock' K-1 with all zeros for income/loss, but then only enter the health insurance in the spot on the K-1 worksheets (and the associated Box 5 of the W-2).