IRS/ACA rules regarding healthcare reimbursements and tax implications are complex. It is safe to say that if you only have one employee — and no more — working any number of hours, then you can reimburse that one employee for individual health care insurance premiums on a pre-tax basis — and you won’t create an Affordable Care Act violation. There are other situations that could qualify as well. More details are available at the “New IRS rules for medical premiums” link below.
For those who do not meet the “one employee” criteria, a Qualified Small Employer Health Reimbursement Arrangement may be a good choice. A QSEHRA is a way for employers with fewer than 50 full-time equivalent employees to assist with health care premiums on a pre-tax basis. Listed below are two videos and several documents that can walk you through some of the details of setting up a QSEHRA for your organization. Options range from fairly simple to more complex. As a courtesy to those we serve, BBT has worked with our legal counsel to provide basic details and a template for a simple QSEHRA structure. While these documents have been reviewed by BBT’s legal counsel, it is recommended that your specific situation and questions be reviewed by your own legal counsel.
New IRS Rules for Medical Premiums
In the video below Katie Shaw Thompson explains how her church, Highland Avenue Church of the Brethren, Elgin, Ill., helped her take advantage of savings through QSEHRA.
Checklist for setting up a QSEHRA
QSEHRA Plan Document June 30, 2017
QSEHRA Application June 28, 2017
Sample Employee Notice for QSEHRA