Individual Tax Preparations
Accounting & Bookkeeping
Management Conferences
Medical Reimbursement Plan - Section 105 |
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| A medical reimbursement plan may save self-employed individuals hundreds or even thousands of dollars in taxes. It is a very simple procedure, however, you should do it now. Do not wait until the end of the year. Even though the IRS has increased the deductibility of health care premiums for self-employed people, a section 105 Medical Reimbursement Plan is still a better deal. Here is how it works: 1. Hire your spouse. 2. Set up a fringe benefits program for your employee. This would include your paying the health insurance premiums and uninsured medical costs for your employee (who happens to be your spouse) and the employee's family. 3. This allows you to deduct your medical expenses as farm or business expenses, and not as itemized deductions. This will save you both income and self-employment tax. 4. You would also need to file payroll tax returns. The cost of preparing these returns is small compared to your tax savings. You do not have to switch health insurance companies, all you have to do is set up the plan and follow it. If you have any full-time employees other than your spouse, they may also have to be included. This is a legal way for you to save on your taxes. It may be worth your time to look into it. Please call so we can discuss this further. *This is general tax information. Each business situation may be different. This information should not be relied upon as your source of authority. Please seek professional advice for all tax and payroll situations. |
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Stetzer Accounting Service W23082 State Road 35 Trempealeau, WI 54661 Tel: 608 534 6558 Fax: 608 534 6316 , Stetzer Accounting Service, All Rights Reserved Web page design and web hosting by Onalaska Web |
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