We are members in an LLC that pays health insurance premiums, and reports those as guaranteed payments. Those guaranteed payments are included in the amount reported as SE income on our K-1. However, since health insurance premiums paid by a corporation (including an S Corporation to it’s owners) are not included in FICA wages, we are wondering if those premiums reported as guaranteed payments can be used to reduce SE income.
If not, this is a significant difference between partnership and corporation taxes.
Hi H. Hall, I’m going to have to recommend that you speak with a tax professional. Unfortunately I am not an expert in this department and not quite sure if those guaranteed payments can be used to reduce SE income.
If you need to locate a tax pro, check out this article for tips and resources on how to find one:https://fitsmallbusiness.com/how-to-find-a-quickbooks-proadvisor/
All the Best-
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