W-2 Income

Our document uses W-2 income. Working within a payroll company, we get to see all the bits and pieces of compensation. Should shareholders health insurance(SHI) and auto reimbursement be included in the W-2 income for compensation purposes?

S-Corp shareholders (more than 2%) are taxed on health insurance and auto reimbursement, even if the auto is used solely for business purposes.  Check to make sure the plan document does not exclude fringe benefits.  

For c-corp shareholders, I don't think the health insurance would be reported on the W-2.  For the auto, it depends on why they use the auto.  

I'm not sure if the recent Tax Act changed any of this.  I know it had a lot of changes to fringe benefits.  

Short answer, yes they are included.

Edit: Longer answer

IRC §1372 - for purposes of fringe benefits, 2% S Corp SH is treated as a partner of a partnership. 

IRC §106 - Employee gets to exclude employer provided health coverage form gross income.  Since the 2%SH is NOT an employee (partner per §1372 above), the 2%SH does not get to exclude it from gross income.

Employer provided health coverage is included in W-2 Box 1, but not Box 3 or Box 5. Premiums should be listed in Box 14 (but I have seen a lot of preparers not list it).

For some reason I think auto is included in Box 3 and Box 5 as well, but not 100% sure and I don't think it matters for our purposes.

as @ERISAAPPLE points out, make sure fringe benefits are not excluded in the definition of comp.