True/False: Sarah's employer pays the hospitalization insurance premiums for a policy that covers all employees and...
True/False:
Sarah's employer pays the hospitalization insurance premiums for a policy that covers all employees and retired former employees. After Sarah retires, the hospital insurance premiums paid for her by her employer can be excluded from her gross income.
Please explain the answer
Homework Answers
Sarah Employers pays the hospitalisation insurance premium for a policy that covers all employees and retired former employees. It is general policy as a benefit provided by the employer it will not be treated as wages and are not subject to Social Security, Medicare, and other taxes withholding. The IRS has specifically excluded the employers health plan so as to keep it benefecial for the entire employees community as a whole.
However this benefit is not available for the employees of the corporations where the employees hold more than 2% of the share of the corporation, In this case of sarah, there is no specific Information is given
Thus when the employer pays the hospitalization insurance premiums for a policy that covers all employees and retired former employees.For sarah the the premium paid by her employers are not to be included in her gross income.
The Correct Answer is True
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