one time reimbursement to S corp owner for health insurance premiums

Hi there, @ sbrenner.

Allow me to step in and provide additional insights about an employee who is a sole shareholder of S-corp, and personally paid for his health insurance. 

As per IRS, a 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but don't treat the benefit as a reduction in distributions to the 2% shareholder. 

See article: https://www.irs.gov/pub/irs-wd/[removed].pdf. 

To make sure your books are accurate, I'd recommend consulting with a tax expert or an accountant to guide you on how to reimburse your employee. 

For future reference, you may also want to read the following topics from our resources: 

• Fringe benefits and tax forms. It helps you learn about how this benefit affects employee's tax forms. 
• Create taxable fringe benefits payroll items. It has a step-by-step guide on how the fringe benefit will be paid to the employee based on the scenario listed in this article. 

Should you need any further assistance, please don't hesitate to contact me. Wishing you continued success!