You are navigating a minefield here, and because of the continually changing laws for this type of thing, you should probably tie this in with a third-party organization that specializes in healthcare plans for small businesses.
- If it is equally offered to all employees, this Employer Payment Plan (EPP) or Health Reimbursement Arrangement (HRA) is tax free to the non-shareholder employees.
- If it is discriminatory offered to selected employees, it is added to taxable wages.
- If the corporation pays for more than one employee (including yourself) it gets much more tricky.
- Your reimbursement is added to box 1 of your W-2. Nothing is added to the W-2 for other employees.
- The maximum reimbursement under this "Qualified Small Employer Health Reimbursement Arrangement" for your employee would be $4950 ($10,000 for family plan) per year. It should also be documented this arrangement only pays for insurance premiums. This is a brand-new law that just passed three weeks ago (the prior law would have subjected the corporation to gigantic penalties), so there will be more Regulations, rules, guidance, etc. on this coming in the future months and years. This is where it would be a particularly good idea to be associated with a health organization that specializes in this type of thing.
