Rosemary Snorek hired her husband, Ivan, to perform repair and recovery services for Snorek Upholstery, a sole proprietorship operating in Owatonna, Minnesota. Rosemary paid Ivan $480 in cash wages and $10,355 in section 105 medical plan benefits.

In this trial, the only issue was the $3,906 Blue Cross/Blue Shield health insurance payment that covered Rosemary (the $3,906 was part of the $10,355). The court ruled that Rosemary gets no business deduction for the $3,906 health insurance premium because Rosemary could not ... Log in to view full article.