105(h) Discrimination Question

[Scott]

Looking for some confirmation here.

A company with a self-insured plan wants to amend the plan to expand the definition of "dependent" but only with respect to certain executives (most, if not all, of which are highly compensated). The expanded definition would still be within the definition of dependent under Code Section 152. For example, the plan would allow an executive to cover his mother-in-law who qualifies as a dependent under Section 152. The company currently pays a portion of the premiums for dependent coverage.

Am I correct that no portion of the company-paid premiums would be taxable, but that anything reimbursed with respect to a highly compensated individual's mother-in-law would be taxable? Any other thoughts or concerns?