• Skip to primary navigation
  • Skip to content
  • Skip to primary sidebar
  • Skip to footer

Mandeville CPA - CMR Associates, LLC

  • Home
  • Services
    • Tax Accounting
    • Small Business Accounting
    • Business Consulting
    • Business Valuation
    • Notary Services
  • Industries
    • Construction
    • Musicians
    • Real Estate
    • Retail
    • Restaurants and Hospitality
  • About Us
  • Book Appointment

Tax Accounting and Business Consulting for Mandeville, Louisiana

Which tax-advantaged health account should be part of your benefits package?

mandeville la Certified Public Accountant Tax Preparation Health Care

Which tax-advantaged health account should be part of your benefits package?

On October 12, an executive order was signed that, among other things, seeks to expand Health Reimbursement Arrangements (HRAs). HRAs are just one type of tax-advantaged account you can provide your employees to help fund their health care expenses. Also available are Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs). Which one should you include in your benefits package? Here’s a look at the similarities and differences:

HRA. An HRA is an employer-sponsored account that reimburses employees for medical expenses. Contributions are excluded from taxable income and there’s no government-set limit on their annual amount. But only you as the employer can contribute to an HRA; employees aren’t allowed to contribute.

Also, the Affordable Care Act puts some limits on how HRAs can be offered. The October 12 executive order directs the Secretaries of the Treasury, Labor, and Health and Human Services to consider proposing regs or revising guidance to “increase the usability of HRAs,” expand the ability of employers to offer HRAs to their employees, and “allow HRAs to be used in conjunction with nongroup coverage.”

HSA. If you provide employees a qualified high-deductible health plan (HDHP), you can also sponsor HSAs for them. Pretax contributions can be made by both you and the employee. The 2017 contribution limits (employer and employee combined) are $3,400 for self-only coverage and $6,750 for family coverage. The 2018 limits are $3,450 and $6,900, respectively. Plus, for employees age 55 or older, an additional $1,000 can be contributed.

The employee owns the account, which can bear interest or be invested, growing tax-deferred similar to an IRA. Withdrawals for qualified medical expenses are tax-free, and employees can carry over a balance from year to year.

FSA. Regardless of whether you provide an HDHP, you can sponsor FSAs that allow employees to redirect pretax income up to a limit you set (not to exceed $2,600 in 2017 and expected to remain the same for 2018). You, as the employer, can make additional contributions, generally either by matching employer contributions up to 100% or by contributing up to $500. The plan pays or reimburses employees for qualified medical expenses.

What employees don’t use by the plan year’s end, they generally lose — though you can choose to have your plan allow employees to roll over up to $500 to the next year or give them a 2 1/2-month grace period to incur expenses to use up the previous year’s contribution. If employees have an HSA, their FSA must be limited to funding certain “permitted” expenses.

If you’d like to offer your employees a tax-advantaged way to fund health care costs but are unsure which type of account is best for your business and your employees, please contact us. We can provide the additional details you need to make a sound decision.

Tax Accounting, Tax Preparation, and Business Consulting for Metairie, Louisiana
Industry Specific Accounting
Metairie CPA Services
Metairie CPA News

Tax Accounting, Tax Preparation, and Business Consulting for Mandeville, Louisiana
Industry Specific Accounting
Mandeville CPA Services
Mandeville CPA News

Tax Accounting, Tax Preparation, and Business Consulting for Baton Rouge, Louisiana
Industry Specific Accounting
Baton Rouge CPA Services
Baton Rouge CPA News

Tax Accounting, Tax Preparation, and Business Consulting for Covington, Louisiana
Industry Specific Accounting
Covington CPA Services
Covington CPA News

Mandeville Notary Public Services
Madisonville Notary Public Services
Covington Notary Public Services

Filed Under: Small Business Tax Advice

Primary Sidebar

About Us

Mandeville CPA Tax Accounting Business

Tax Accounting and Business Consulting for Mandeville, Louisiana We specialize in tax accounting,

Business Consulting

Mandeville CPA Business Consulting

Business Consulting for Mandeville, Louisiana: New Business Venture Start-Up – We file all

Tax News and Advice

  • Individual Tax Advice
  • Small Business Tax Advice

Footer

Company Profile

Charles Renwick, CPA has provided clients big and small quality accounting, tax, and business consulting services for over 15 years. We have all the resources needed to meet your business and personal accounting needs.

Offices in Madisonville, Mandeville, Metairie, and Baton Rouge.

Accounting News and Updates

  • 2 ACA taxes that may apply to your exec comp
  • Which tax-advantaged health account should be part of your benefits package?
  • Accelerate your retirement savings with a cash balance plan
  • “Bunching” medical expenses will be a tax-smart strategy for many in 2017
  • Timing strategies could become more powerful in 2017, depending on what happens with tax reform
  • Investors: Beware of the wash sale rule
  • 2 ways spouse-owned businesses can reduce their self-employment tax bill
  • Why you should boost your 401(k) contribution rate between now and year end

Book an appointment with Personnel Calendar using SetMore

Write or Call Today

CMR Associates, LLC
1070 West Causeway Approach
Suite B
Mandeville, LA 70471
(888) 530-5630
office@cmrtax.com

© 2023 · Web Design by Link+Like ·