tax strategy is an essential part of any small business plan . Many of the most successful owners of small businesses carefully review the tax code, consult qualified tax experts, and make decisions based on their tax consequences. In recent 
years, many of these decisions were related to health care in the Affordable Care Act specifically and generally. One particular strategy has attracted the attention of savvy small business owners looking for easy ways to tax to provide health benefits to their employees. This strategy, commonly known as Medicare reimbursement premium, helps companies provide their employees with monthly contributions in real dollars as reimbursement of eligible medical expenses. These repayment contributions offer several specific tax benefits.
Benefits of Income Tax
Pursuant to section 105 of the Tax Code, employers are allowed to reimburse employees for qualified medical expenses, including individual health insurance premiums. Such arrangements, known as medical reimbursement plans allow reimbursement of premiums to shift from employer to employee completely tax free. In other words, an employee of a small business can buy an individual policy of insurance on the exchange of health care and receive a refund of tax for this purchase.
Tax benefits payroll
For many small companies, payroll is one of the biggest expenses for hitting the books each month. Most of these expenses, of course, can be attributed to wages and salaries of employees. Some of them, however, comes from taxes on wages, or the percentage of wages paid to the federal and / or state. Because these contributions in real dollars are reimbursements for eligible expenses and not a salary, they are not subject to tax on the payroll. The reduction of social charges, of course, can have significant benefits for small businesses, which often operate on tight monthly budgets.
Tax credits
Although there are several direct tax benefits associated with the health insurance premium refund, other benefits are less obvious. For example, many Americans who do not get health insurance through their jobs are eligible for tax credits or reductions on individual health policies. Of course, eligibility depends on several factors, including the level of income. To qualify for these grants, buyers must buy a policy through the exchange of health care their condition.
Conclusion
savvy business owners and smart employees make financial decisions with their tax implications in mind. These owners of small businesses Tax spirit were more drawn to the medical reimbursement plans as a way to offer franchise tax health benefits to their employees. Given the savings they offer on the income tax and payroll tax, it is not surprising that these plans are being adopted by more and more small businesses in the United States.
What do you think? What questions do you have about the tax benefits? Leave a comment or question below.
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