A self-employed person is allowed to deduct SEHI "above-the-line" only to the extent of the self-employed earnings, .e., Sch C net income (less one-half of the SE tax).

To compare, an S corp shareholder has no SE income, so the equivalent is the EARNINGS from the S corp--meaning the wages.

The SEHI is included in Box 1 wages but NOT box 3 or 5(Medicare wages). If there are no wages other than SEHI, then the shareholder gets no deduction above-the-line.

You gotta have other wages in Box 5.