Can you deduct Long Term Care Preimums the same as Health Insurance for the greater than 2% Shareholder.
Answer is .... sort of....
The way the math works…….
Let’s say LTC is $6,000
Age based LTC for age 61 to 70 is $3,900
Step 1: The S Corp deducts the entire $6k (even if the Shareholder pays it personally).
Step 2: Box 1 on the W2 is increased by $6k.
Step 3: Box 14 on the W2 includes the aged based allowable amount $3.9k.
So, steps 1 and 2 cancel each other.
Step 3 allows 100% of the allowable deduction ($3.9k) to be deducted on the front of the individual tax return, same as regular health insurance.