S-Corp Fringe Benefits: The Complete Guide
C-Corporations have generous fringe benefit provisions. But that’s not the case for S-Corps. We’ll discuss the different provisions.
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Can an S-Corp Have a Medical Reimbursement Plan?
The IRS treats majority shareholders as self-employed individuals rather than employees, meaning any health benefits become taxable income instead of tax-free reimbursements. However, enterprising S-Corp owners have found legitimate workarounds by creating C-Corporation subsidiaries or sole proprietorship arrangements where they can qualify as employees.
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HRAs for S-Corp Owners: Our Favorite Workaround
S-Corporation owners face a frustrating reality when it comes to Health Reimbursement Arrangements: if you own more than 2% of your S-Corp, you’re locked out of the tax-free medical reimbursement benefits that regular employees enjoy. But we have a solution.
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How to Set Up a Medical Reimbursement Plan Online
Setting up a medical reimbursement plan no longer requires mountains of paperwork or expensive consultants—today’s online platforms have transformed the process into a streamlined, user-friendly experience.
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HRA for Dummies: How do Section 105 Plans Work
Navigating employee health benefits can be overwhelming for small business owners, but Section 105 plans offer a surprisingly simple and tax-efficient solution. Also known as Health Reimbursement Arrangements (HRAs), these employer-sponsored plans allow businesses to reimburse employees for medical expenses using pre-tax dollars.
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Section 105 Plan Template: IRS Compliant Language
A Section 105 plan allows employers to reimburse employees for medical expenses on a tax-free basis—but only if the plan is properly documented. This article outlines the key components of a compliant Section 105 plan document, including required language, eligibility rules, covered expenses, reimbursement procedures, and legal disclosures.
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The Complete Eligibility Guide to Section 105 Plans
Section 105 plans offer powerful tax-free medical reimbursements for employees, but eligibility rules must be followed precisely to maintain compliance. This guide explains who qualifies—including W-2 employees—and who is excluded, such as sole proprietors, partners, and 2% S-corp shareholders.
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Section 105 Plan Eligible Expenses: Here is the List
This article outlines the most common reimbursable items—such as doctor visits, prescriptions, dental care, and insurance premiums—while also highlighting lesser-known qualified expenses like fertility treatments and medical travel.
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Can I Write Off Medical Expenses if I’m Self-Employed?
Self-employed individuals often struggle to deduct medical expenses. While insurance premiums may be partially deductible, most out-of-pocket costs are not. However, a properly structured Section 105 plan can change that.
Can I Write Off Medical Expenses if I’m Self-Employed? Read More »
Section 105 Plan Limits: Restrictions and Benefit Caps
Section 105 plans allow small businesses to reimburse employees for medical expenses on a tax-free basis. These plans offer valuable tax savings but must follow strict IRS rules. Limits apply to eligible expenses, participant eligibility, benefit amounts, and administrative procedures.
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