Account for tracking Health insurance paid by LLC for owner and family

solarken · ‎March 14, 2022

I have a single member LLC and recently joined a local group that offers health insurance, and some other benefits at a group rate. I get paid by taking draws when needed, and I understand I am a member and not an employee of the LLC. I believe I will be able to deduct the health, dental, and vision insurance premiums that my LLC pays by listing on Schedule 1 of my personal tax return.

Is there a recommended way to track the health insurance payments paid by the LLC for me the owner? Should I create a new account, what type and what should I name it? Also, should I associate the account with a tax line item?

If I understand correctly, if I hire an employee, I should track any payments made for health insurance premums for the employee as payroll expenses. So it seems I will have two different processes for recording healthcare insurance payments, one for owner and one for employees.

In addition, I also started a 401K. Should I also track matching contributions for me the owner and a future employee separately in different accounts? I am trying to keep straight the differences in how the single member is treated and and emplyee is treated for these things. Thank you,

ShiellaGraceA · ‎March 14, 2022

I'll make sure you're able to keep track of your health insurance deduction, @solarken.

You'll have to record your deductions as health insurances expense. Yes, you'll need to create a new tax line item for this and a new account. This way, you can keep track of the paid premium to be included on the LLC member's W2 by the end of the year.

I recommend consulting with an accountant to ensure you're recording it correctly in QuickBooks. They can guide you on what account to use and the correct tax tracking type of the health insurance item.

About 401(k), yes, you can create an employee and company match for the premium. These deductions will be posted in your payroll liability account.

For the step-by-step instruction, please check out this guide: Set up a payroll item for retirement benefits (401(K), Simple IRA, etc.)

Additionally, here's a link that'll help you manage payroll-related tasks. It has payroll topics with articles. Just look for a title that'll fit your concern: View all help for QuickBooks Desktop Payroll.

Please don't hesitate to reach out to me again through this thread. I'm more than willing to assist you. Take care and have a wonderful day ahead.

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Account for tracking Health insurance paid by LLC for owner and family

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