A common question we get from small employers and their advisers is, "insurance reimbursement tax-free disease is still allowed?" the answer is yes, although there is a good and a bad way to s' . take
Note - This question was raised during our recent webinar "? Can free labor redemption premium tax for you " If you want to download the webinar and slides on request, click here.
the tax code allows always free tax refund
first, the non-taxable reimbursement of individual health insurance is 100 percent authorized by current internal Revenue code (IRC)
IRC section 105 .: Article 105 enables non-taxable reimbursement of a refund scheme for self-insured medical expenses if repayments are fresh committed to "medical care" as defined in section 213 (d).
IRC section 213 :. section 213 (d) defines "care medical "for the personal deduction and section 105 distributions, which includes amounts paid for insurance
IRC section 106 :. Article 106 allows the value of the rebate scheme for self-insured medical expenses to be tax-free employees
IRC Section 162 Article 162 allows refunds to be the employer as a deductible business expense tax
like you can see, a key element is that formal, self. repayment plan for uninsured medical expenses is used (sometimes called a system of reimbursement of health care or Section 105 plan).
Another key element is that the repayment plan of self-insurance medical expenses is a group health plan. As such, it must also comply with the new law the Affordable Care (ACA) Reforms of the market.
Compliance with market reforms
To pay employees, and to avoid costly expenses tax free, the repayment plan must be designed to comply with the ACA market reforms (PHS 2711 PHS and 2713), as well as existing federal regulations (ERISA, HIPAA, COBRA, IRS).
How a repayment plan can comply with market reforms?
PHS Act 2713 requires all group health plans to cover basic health preventive services without cost sharing. To comply, the repayment plan reimburses basic preventive care on an unlimited basis.
PHS Act 2711 provides that no annual or lifetime limits can be placed on essential health benefits. To comply:
-
The repayment plan can not place an annual limit on preventive services basic health.
-
health insurance premiums are not essential health benefits - therefore, a premium payment plan can place an annual limit "specific premium "on premium refunds.
Conclusion
under the current tax code, the tax-refund individual health insurance is still allowed by a self repayment plan for uninsured medical expenses.
the repayment plan, however, must be structured to comply with the new reforms the group health plan. an example of a consistent design used for the repayment person insurance tax-free disease is a medical reimbursement plan.
more
-
Infographic - compliance ZaneHealth Understanding
-
Top 5 compliance matters health insurance Reimbursement
-
Whiteboard session - compliance 101 [Video]
What questions do you have about the individual reimbursement health insurance? Leave a question below.
0 Komentar