Business owner eligibility for a QSEHRA
The qualified small employer HRA, or QSEHRA, is a tax-free health benefit that allows small businesses and nonprofits to reimburse employees for their eligible medical expenses, including health insurance premiums. But can business owners participate in their organization's QSEHRA? The answer depends on your business structure.
C corp owners can participate in a QSEHRA because the IRS recognizes them as separate legal entities from their owners. However, if you're a S corp owner or more than 2% shareholder, you can't participate in a QSEHRA, and neither can your spouse or dependents. If you have a partnership or you're a sole proprietor, you can only participate in the QSEHRA through your spouse as a dependent if they're a W-2 employee.
To learn more about the QSEHRA, visit PeopleKeep.com.