Business Owner with Personal Insurance

[jason5436]

I have a person who owns a small business. She is in real estate and the employees are part time but sometime full time. The are 5 families with separate policies who we want to sign up for individual plans. Here is the question? Is it ok for her to pay for the plans with her American express under the business name? Is it ok for them to sign up separately even though they all work for her. She just doesn't want to do a commercial group policy. Any thoughts on compliance etc? I don't see a problem with it but just wanted to get some opinions?

 

[timsip]

There certainly are those here smarter on the topic than I, but at first blush, I would say don't do it. Anyone can take money out of their own pocket and pay another person's insurance bill, but when a business does it for their employees, that is a whole different arena of government rules.

 

[mwoodbrid]

It's absolutely not the correct way to provide for their coverage, and could come back to bite both you and her pretty hard. The IRS has been pretty clear on this topic, viewing it as a tax avoidance issue.