Employee health insurance premiums belongs on Line 14, employee benefit programs.
Why line 14
Line 14 is for benefit programs you provide to your employees, and employer-paid health premiums for a W-2 employee are the main thing it was written for. The test is who is covered: premiums for an employee who is not the owner go on line 14, and premiums covering you, the sole proprietor, do not. Owner coverage is taken as the self-employed health insurance deduction on Schedule 1 instead, which is why one group policy often has to be split before anything is entered.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so employee health insurance premiums lands on Line 14 without you sorting it.
Start for freeWhat employee health insurance premiums is confused with
- Schedule 1 line 17, schedule 1 line 17, self-employed health insurance
- If the premium covers you or your family rather than an employee, it is the self-employed health insurance deduction on Schedule 1, not line 14.
- Line 19, pension and profit-sharing plans
- Retirement contributions you make for employees are pension and profit-sharing plans on line 19, not a line 14 benefit.
- Line 26, wages
- Cash paid to an employee in place of coverage is taxable compensation and belongs in wages on line 26.
Examples that belong on line 14
- A $740 monthly premium for your one full-time W-2 designer on a small group plan
- The employer share of a small group medical policy, $6,300 for the year
- A $400 a month QSEHRA reimbursement to an employee who buys an individual policy
- Dental and vision premiums you pay for a part-time W-2 bookkeeper
- The employer portion of continuation coverage you agreed to carry for three months after a layoff
What does not belong here
- Your own health insurance premium, which is a Schedule 1 deduction and not a Schedule C expense
- Premiums for a 1099 contractor, whose own coverage is not your benefit to deduct
- The employee payroll-withheld share of the premium, which is already inside gross wages on line 26
- Coverage for a family member who is on payroll only on paper with no real work
The limit that applies
Line 14 is employees only. A one-person business with a family-only policy has nothing to put here and uses the self-employed health insurance deduction instead.
What to keep
Keep the carrier invoices showing the covered employees, payroll records tying each person to a W-2, and the plan document. If one policy covers both you and an employee, keep the allocation you used to split it.
Other expenses on line 14
| Expense | Line |
|---|---|
| an employee educational assistance program | Schedule C, Line 14 |
| an employee wellness or gym benefit | Schedule C, Line 14 |
| dependent care assistance for employees | Schedule C, Line 14 |
| group term life insurance for employees | Schedule C, Line 14 |
| HSA contributions for employees | Schedule C, Line 14 |
Related lookups
- Is my own health insurance a line 15 expense?
- Where do employee SEP-IRA contributions go?
- Can I pay my child and deduct it on Schedule C?
Sources
This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.
Looking for a different expense? The full Schedule C line lookup has every line from 8 to 27 with the expenses that belong on each, and Schedule C expense categories walks the whole form in order.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so employee health insurance premiums lands on Line 14 without you sorting it.
Start for free