For those of us that are a little older, we remember when the pastor was on the denomination’s health insurance, and the only other health benefit was if the church decided to reimburse an employee for premiums. And then Obamacare happened. Obamacare changed a lot of things. One of the negative changes is that these very informal reimbursement agreements became taxable. Soon after the election of President Trump, a loophole opened up that allows reimbursements in a very regulated way. This loophole is QSEHRA (I pronounce it Q-Sara).
Here’s the gist of it.
- Almost all churches can use this.
- Need to offer the same amount to all eligible employees (except can discriminated based on age and family status).
- Need to adopt a Plan Document (template below in the links).
- Plan Document Template: https://www.dakotasumc.org/media/files/CONFERENCE/5_Conf_Finance_Benefits/Finance/QSEHRA_Plan_Doc.docx
- Take Command’s QSEHRA explanation: https://www.takecommandhealth.com/qsehra-guide
- PeopleKeep post on QSEHRA & Church: https://www.peoplekeep.com/blog/will-the-qsehra-work-for-my-church
- List of Eligible Expenses to Reimburse: https://www.peoplekeep.com/irs-502-eligible-expense-tool
- Health Options for Churches: https://pastorswallet.com/health-insurance-for-pastors-what-are-your-options/