Can employee/children of self employed individual be covered under a m

[Guest dcranage]

Can a self-employed individual whose children are employed by the business establish an employer-funded medical expense reimbursement plan covering the children (and other employees of the business)?

[Guest]

Generally, no. However, there is Revenue Ruling authority that a spouse who is a bona fide employee may be covered under the plan. There is no attribution in a self-employed entity. Assuming the spouse is an employee, the children could be covered through the spouse.