Sch F, Line 5 -- Include Employer Contribution

[Jean]

There seems to be some confusion regarding when employer contributions to a health plan are included in the Line 5 total. This is a typical premium only plan. I have two separate references and they contradict each other.

The 5500 Preparer's Manual, pg 13-4, example 1 indicates that they are not. The PPC's 5500 Deskbook, example 9B-1, indicates that they are.

Here is the Preparer's Manual, --

An employer provided health plan costs $3000 per employee. The employer contributes $2500 to the cost of the health plan. The employees pay the remaining $500 in premiums through a Section 125 premium conversion plan. 20 employees reduce their salaries by $500 to pay for health care. There are no other payments or administrative expenses. When completing Sch F, this employer enters $10,000 ($500 x 20) on line 5.

The other example is more detailed, but seems to contradict this example and would state that the amount reported would be $60,000 (20 x $3000).

Any feedback on interpretation would be appreciated.