Last-Minute Year-End Medical Plan Strategies

Written by Coach Janelle CPA on December 6, 2023

All small-business owners with one to 49 employees should have a medical plan for their business.

Sure, it’s true that with 49 or fewer employees, the tax law does not require you to have a plan, but you should.

When you have 49 or fewer employees, most medical plan tax rules are straightforward.

Here are six opportunities for you to consider:

1. If you have not claimed the federal tax credits equal to 100 percent of the required (2020) and the voluntary (2021) emergency sick leave and emergency family leave payments, amend those returns now. You likely made payments that qualify for the credits.

2. If you have a Section 105 plan in place and have not been reimbursing expenses monthly, do a reimbursement now to get your 2023 deductions, and then put yourself on a monthly reimbursement schedule in 2024.

3. If you want to implement a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA), but you have not yet done so, make sure to get that done correctly now. You are late, so you could suffer that $50-per-employee penalty should your lateness be found out.

4. But if you are thinking of the QSEHRA and want to help your employees with more money and flexibility, consider the Individual Coverage Health Reimbursement Arrangement (ICHRA) instead. It’s got more advantages.

5. If you operate your business as an S corporation and want a Form 1040 above-the-line tax deduction for the cost of your health insurance, you need the S corporation to (a) pay for or reimburse you for the health insurance and (b) put that insurance cost on your W-2. Make sure the reimbursement happens before December 31 and you have the reimbursement set up to show on the W-2.

6. Claim the tax credit for the group health insurance you give your employees. If you provide your employees with group health insurance, see whether your pay structure and number of employees put you in a position to claim a 50 percent tax credit for some or all of the monies you paid for health insurance in 2023 and possibly in prior years.

Time is of the essence! Seize the opportunity to enhance your business's financial health with Coach Janelle CPA's exclusive Year-End Tax Strategy Planning Services. Discover the last-minute, game-changing General Business Income Tax Deductions that can significantly impact your bottom line. Coach Janelle, with her expert guidance, unveils key strategies to optimize your tax position and boost your savings. Don't let valuable deductions slip away—read on and take action now to ensure a prosperous financial year ahead. Schedule a consultation with Coach Janelle CPA today and empower your business for success!

About Coach Janelle CPA

Sign Up To Our Weekly Newsletter

Get the latest tax planning tips content delivered straight to your inbox.

 All Your Information is Protected When You Sign Up

Check Out Some Of Our Latest Blog Post

Last-Minute Year-End Tax Strategies for Your Stock Portfolio  

Written by Coach Janelle CPA on December 2, 2023

When you take advantage of the tax code’s offset game, your stock market portfolio can represent a little gold mine of opportunities to reduce your 2023 income taxes. The tax code contains the basic rules for this game, and once you know the rules, you can apply the correct strategies.

Last-Minute Year-End General Business Income Tax Deductions

Written by Coach Janelle CPA on November 25, 2023

The purpose of this article is to reveal how you can get the IRS to owe you money. Of course, the IRS will not likely cut you a check for this money (although in the right circumstances, that will happen), but you’ll realize the cash when you pay less in taxes....

Tax-Free Rental Income with the Augusta Rule

Written by Coach Janelle CPA on November 1, 2023

The Augusta rule gets its name from the Masters Golf Tournament, where some members and others who live in the area receive tax-free rent by renting their homes for a week or two. You don’t have to live in Augusta to benefit from this rule...

Deduct Travel by Car, Train, Plane, or Boat

Written by Coach Janelle CPA on October 25, 2023

Say you are going to travel from your home in Washington, D.C., to San Francisco. Will the tax law allow you to travel to San Francisco by car, train, plane, or boat, your choice? Answer. Yes. But special rules apply. You need to know these rules to guarantee your deductions...

Donating Clothing to Goodwill and the Salvation Army

Written by Coach Janelle CPA on October 18, 2023

As the year comes to a close, many taxpayers consider making clothing and household item donations both to give back and to optimize their tax deductions. Recent cases, like the one involving Duncan Bass, underscore the significance of understanding and adhering to IRS regulations related to these contributions...

Act Now! Get Your Safe-Harbor Expensing in Place

Written by Coach Janelle CPA on September 27, 2023

For 2024, you can elect the de minimis safe harbor to expense assets costing $2,500 or less ($5,000 with audited financial statements or similar) The term “safe harbor” means that the IRS will accept your expensing of the qualified assets if you properly abided by the safe harbor rules...

HSAs for Business Owners

Written by Coach Janelle CPA on September 2, 2023

When enacted, the Affordable Care Act (ACA) eliminated most small-business health plans that reimbursed individually purchased health insurance. Consequently, many small business owners with fewer than 50 employees chose health savings accounts (HSAs) or opted to provide no health coverage at all....

Update on State Pass-Through Entity Taxes Beating the SALT

Written by Coach Janelle CPA on September 6, 2023

Here are some critical updates on the pass-through entity tax (PTET), which has recently become the rule in most states rather than the exception. The PTET enables owners of pass-through businesses, such as S corporations and multi-member LLCs, to navigate around the $10,000 annual limit on state and local taxes (SALT).

ICHRA Unleashed: Transforming Small Business Health Benefits

Written by Coach Janelle CPA on August 23, 2023

The individual coverage health reimbursement arrangement (ICHRA) allows businesses of all sizes, from large corporations to small businesses like yours, to reimburse employees for their personally purchased health insurance expenses...

The QSEHRA Health Plan

Written by Coach Janelle CPA on August 4, 2023

If you’re a small employer (fewer than 50 employees), you should consider the Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) as a good way to help your employees with their medical expenses....

Strategic Insights for Employing Your Spouse

Written by Coach Janelle CPA on July 21, 2023

If you own your own business and operate as a proprietorship or partnership (wherein your spouse is not a partner), one of the smartest tax moves you can make is hiring your spouse to work as your employee. But the tax savings may be a mirage if you don’t pay your spouse the...

Share Us On Social Media