IRS Settlement Guidelines (November 2001)

The most recent lRS interpretation was November 16, 2001. The IRS issued Settlement Guidelines TNT 222-25 and TNT 222-23 that are rules IRS agents are to follow relating to medical reimbursement plans. In summary, the IRS concluded that:

• An employer who is self-employed can deduct the costs of providing accident and health insurance to his employee-spouse under section 162 if the spouse is a bona fide employee.
• That employer reimbursement under a self-insured accident and health plan for medical expenses incurred before the plan was adopted aren't excludable from the employee's gross income.

To view the full text of the IRS Position Reports, please select below:

• Health Insurance Deductibility for Self-employed Individuals
• Retroactive Adoption of an Accident and Health Plan

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