Article Date:
November 2018


Word Count:
582

 

 

Q&A: Health Insurance Premiums and Reasonable Compensation


Question

 

I’m an S corporation owner and I pay myself a $40,000 salary. (I’ve done research, and this is reasonable compensation based on my industry.)

 

My wife decided to quit her job and give up her employer-provided health insurance, so I need to pay for our health insurance, which should be $10,000 annually.

 

Do I lower my cash salary to $30,000 due to the $10,000 in health insurance now paid by my S corporation? Or do I continue to pay $40,000 in cash wages and have total taxable wages of $50,000? ... Log in to view full article.

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