2% Shareholder Health Ins. in S Corp -- W-2

[SunTaxMan]

For tax year 2010, 2% Shareholder Health Insurance had to be added to taxable wages (for income tax) on W-2.

For tax year 2011, did this change? I am not seeing references to this, but don't remember seeing anything about a change. Should Health ins be added to wages for 2011?

Thanks,

[jklcpa]

No rule change on that for 2011. It should be included in the W-2.

[Randall]

No change. But remember it does not go in the SocSec and Medicare wages. And on the 1040, the deduction is limited to the amount of Medicare wages (same for retirement account eligibility). So if wages are low and ins is high, there may be a lower deduction on 1040 than the income added thru W2.

[jetaxes]

Also on the W-2 in Box 14 I put 2% MED 3333.00. i have been

doing this for 3 years.

Joan

[SunTaxMan]

jetaxes. I understand the entry in Box 14 is not REQUIRED, but a convenience for the employee. Correct?

[jetaxes]

I cannot remember where I got the info to put it in Box 14!! But I do know it is a

good reminder for a tax preparer to take it is a deduction on Sch A if they can

Itemized Deduction. I don't believe I got info from IRS!

[Randall]

I put it in box 14 to show the difference between box 1 and boxes 3 & 5.

[jetaxes]

Yes Randall, that is the figure I used too.

Joane