valemike[at]yahoo.com wrote:

- quote -

I'm presuming that your LLC is being taxed as a partnership
for federal tax purposes.

You're confusing being an employee with being a partner.
An employee doesn't have to include the value of
employer-provided health insurance in the employee's
income because of Code section 106. A partner is not
an employee, so this exclusion does not apply.

Health insurance paid by a partnership for a partner
is generally treated as a guaranteed payment to the
partner and must be included in the partner's income.
The partner may be able to take an offsetting deduction
for the health insurance if he meets the requirements
under section 162(l), but taking the deduction is
contingent on not being eligible for any other health
insurance plan, either through the partner or the
partner's spouse.

Benefits and partnerships are both extremely complicated
areas of the tax law. I'd recommend getting yourself to
a qualified tax advisor as quickly as possible.

--Chris

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I am a member of an LLC with a total of 4 members. Two of
the members recently chose a group health insurance which I
and another LLC member declined at this time.

Let's say the health insurance premiums will cost $16,000
for the tax year. The LLC gets billed by the insurance
company, and pays each premium.

Will such a practice of the LLC paying a few of the members'
health insurance premiums go against the 'earnings' of the
member who isnt insured? I wouldn't want to earn less money
as a member because it instead went to pay other members'
health insurance premium.

How does this stuff work during tax time?

Thanks,
Mike

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >