Eligibility of COBRA Premiums for S-Corp Self-Employed Health Insurance Deduction

Legal Questions
1

I am a >2% shareholder of my S-Corp. In 2025, I was covered under my former employer’s COBRA plan and paid 100% of the premiums (unsubsidized) from my personal account.

I would like to claim the Self-Employed Health Insurance Deduction (Form 7206) for these premiums, but I am finding conflicting views on whether a COBRA policy satisfies the “plan established under the business” requirement.

  1. If my S-Corp reimburses me for these COBRA premiums and includes that amount as wages in Box 1 of my W-2 (but not Boxes 3 or 5), does this satisfy the “established by the S-Corp” requirement under Notice 2008-1?
  2. Does the fact that the policy is a continuation of a prior employer’s plan—rather than a new policy in my name or the S-Corp’s name—disqualify it from being “established under the business”?
  3. If this is considered a “grey area,” what is the most defensible way to report these payments to ensure I don’t lose the deduction?