Guest Sieve Posted October 21, 2008 Report Share Posted October 21, 2008 Now, now boys . . . If this employer has an arrangement, understood by all, to give up to $100/year to each employee to reimburse for health care expenses, and includes the payment in income--assuming I have my facts straight from this "interesting" post--there is no need for it to be in writing. Lots of employer practices are not in writing. What the IRS needs for a plan to be a non-taxable medical reimbursement plan is immaterial (or irrelevant--I never knew the difference), since this is not being treated as a non-taxable benefit. The CEO probably has the authoirty to begin such a program, but, on a practical level, that depends on company and Board policy. If a shareholder complained about the expense, I doubt that it's a policy that would be overturned by a court--after all, employee compensation is not set by the Board (except for management types), and this is a form of compensation (and an inexpensive one, at that). If you're not making this a non-taxable benefit, then do what you want--as per company/board policy. It is, however, a good idea to put it in writing--even if just a summary page in an employee handbook, or a pay envelope stuffer--so that there are no surprises or disagreements which might lead to employee discontent and mistrust. And, there may be a state law to be concerned about, since insurnace (& this is self-insurance) and health plans are traditionally the provence of the state. Link to comment Share on other sites More sharing options...
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