S-Corp Medical Insurance, Different Policy

[geekgirldany]

I have a client that's S-Corporation has a group policy. For various reasons his wife had to get an individual policy in her name. So she is no longer in the group--through him. Can the S-Corp pay for her policy? She is not an employee... but I am thinking that it can not pay for it because it has to be one policy covering whole family... not individual policies.

Thanks for any input.

[DaveO]

Is she eligible to be covered under the group plan? If so then no deduction. If she is not allowed into the group plan then the premium would have to show up on his W-2 and be deducted as SE health insurance assuming he is a 2% shareholder.