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Article Date:
June 2011

Word Count:



IRS Lets Small Business off the Hook for W-2 Reporting of 105 Plans

The Section 105 medical plan is ideally suited for the one-owner proprietorship business with no employees other than the owner’s spouse.


Proprietors in this situation can hire their spouses as their only employees, cover their employee-spouses with Section 105 medical reimbursement plans, and count the reimbursements under the plans as the sole remuneration to the spouses. In this scenario



employer-spouses (proprietors) deduct the 105 reimbursements as business expenses on their Schedule Cs in the employee welfare benefit category and


employee-spouses receive tax-free fringe ... Log in to view full article.

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