§106 — Contributions by employer to accident and health plans
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Statute Text — 26 U.S.C. §106
Except as otherwise provided in this section, gross income of an employee does not include employer-provided coverage under an accident or health plan.
In the case of an employee who is an eligible individual, amounts contributed by such employee’s employer to any Archer MSA of such employee shall be treated as employer-provided coverage for medical expenses under an accident or health plan to the extent such amounts do not exceed the limitation under section 220(b)(1) (determined without regard to this subsection) which is applicable to such employee for such taxable year.
No amount shall be included in the gross income of any employee solely because the employee may choose between the contributions referred to in paragraph (1) and employer contributions to another health plan of the employer.
Any employer contribution to an Archer MSA, if otherwise allowable as a deduction under this chapter, shall be allowed only for the taxable year in which paid.
Every individual required to file a return under section 6012 for the taxable year shall include on such return the aggregate amount contributed by employers to the Archer MSAs of such individual or such individual’s spouse for such taxable year.
Paragraph (1) shall not apply for purposes of section 4980B.
For purposes of this subsection, the terms “eligible individual” and “Archer MSA” have the respective meanings given to such terms by section 220.
For penalty on failure by employer to make comparable contributions to the Archer MSAs of comparable employees, see section 4980E.
Gross income of an employee shall include employer-provided coverage for qualified long-term care services (as defined in section 7702B(c)) to the extent that such coverage is provided through a flexible spending or similar arrangement.
For purposes of this subsection, a flexible spending arrangement is a benefit program which provides employees with coverage under which—
specified incurred expenses may be reimbursed (subject to reimbursement maximums and other reasonable conditions), and
the maximum amount of reimbursement which is reasonably available to a participant for such coverage is less than 500 percent of the value of such coverage.
In the case of an insured plan, the maximum amount reasonably available shall be determined on the basis of the underlying coverage.
In the case of an employee who is an eligible individual (as defined in section 223(c)(1)), amounts contributed by such employee’s employer to any health savings account (as defined in section 223(d)) of such employee shall be treated as employer-provided coverage for medical expenses under an accident or health plan to the extent such amounts do not exceed the limitation under section 223(b) (determined without regard to this subsection) which is applicable to such employee for such taxable year.
Rules similar to the rules of paragraphs (2), (3), (4), and (5) of subsection (b) shall apply for purposes of this subsection.
For penalty on failure by employer to make comparable contributions to the health savings accounts of comparable employees, see section 4980G.
A plan shall not fail to be treated as a health flexible spending arrangement or health reimbursement arrangement under this section or section 105 merely because such plan provides for a qualified HSA distribution.
The term “qualified HSA distribution” means a distribution from a health flexible spending arrangement or health reimbursement arrangement to the extent that such distribution—
does not exceed the lesser of the balance in such arrangement on
September 21, 2006
, or as of the date of such distribution, and
is contributed by the employer directly to the health savings account of the employee before
January 1, 2012
.
Such term shall not include more than 1 distribution with respect to any arrangement.
If, at any time during the testing period, the employee is not an eligible individual, then the amount of the qualified HSA distribution—
shall be includible in the gross income of the employee for the taxable year in which occurs the first month in the testing period for which such employee is not an eligible individual, and
the tax imposed by this chapter for such taxable year on the employee shall be increased by 10 percent of the amount which is so includible.
Clauses (i) and (ii) of subparagraph (A) shall not apply if the employee ceases to be an eligible individual by reason of the death of the employee or the employee becoming disabled (within the meaning of section 72(m)(7)).
For purposes of this subsection—
The term “testing period” means the period beginning with the month in which the qualified HSA distribution is contributed to the health savings account and ending on the last day of the 12th month following such month.
The term “eligible individual” has the meaning given such term by section 223(c)(1).
A qualified HSA distribution shall be treated as a rollover contribution described in section 223(f)(5).
For purposes of this title—
A qualified HSA distribution shall be treated as a payment described in subsection (d).
Except as provided in clause (ii), section 4980G shall not apply to qualified HSA distributions.
In the case of a qualified HSA distribution to any employee, the failure to offer such distribution to any eligible individual covered under a high deductible health plan of the employer shall (notwithstanding section 4980G(d)) be treated for purposes of section 4980G as a failure to meet the requirements of section 4980G(b).
For purposes of this section and section 105, expenses incurred for menstrual care products (as defined in section 223(d)(2)(D)) shall be treated as incurred for medical care.
For purposes of this section and section 105, payments or reimbursements from a qualified small employer health reimbursement arrangement (as defined in section 9831(d)) of an individual for medical care (as defined in section 213(d)) shall not be treated as paid or reimbursed under employer-provided coverage for medical expenses under an accident or health plan if for the month in which such medical care is provided the individual does not have minimum essential coverage (within the meaning of section 5000A(f)).
Treasury Regulations
- Treas. Reg. §Treas. Reg. §1.106-1 Contributions by employer to accident and health plans
- Treas. Reg. §Treas. Reg. §1.106-1(a) The gross income of an employee does not include the contributions that the employer makes to an accident or health plan for compensation (through insurance or otherwise) to the employee for personal injuries or sickness incurred by the employee, the employee's spouse, the employee's dependents (as defined in section 152 determined without regard to section 152(b)(1), (b)(2), or (d)(1)(B)), or any child (as defined in section 152(f)(1)) of the employee who as of the end of the taxable year has n
- Treas. Reg. §Treas. Reg. §1.106-1(b) Effective/applicability date.
74 Citing Cases
Our conclusion is unaffected by the entertainer,.artist, athlete cases that petitioner relies upon because they are inapposite.
Misleading half-truths are distinguishable from nondisclosures and constitute an exception to the general rule of nonliability for nondisclosure or other failure to act.
ence or disregard ofrules or ¹³Petitioners also suggest that at least a portion ofthe annual contributions is attributable to providing a group-term life insurance benefit covered by sec. 79, and health expense reimbursement benefits are covered by sec. 106. We reject this argument. We have previously concluded that the Machacek, Inc. SBP did not provide group-term life insurance covered by sec. 79. The allocation offunds to the notional accounts to fund the purported health expense reimbursemen
Respondent argues that, the legal fees must be allocated in accordance with the fair-market-value limitations of section 1060, which applies to applicable asset acquisitions . He further argues that all of the legal fees must be allocated under sectio n 1060 to class V intangible assets , which include goodwill and going concern value . He therefore . argues that the legal fees must be amortized; ratably over .15 years beginning with the mont h of purchase under section 197 . Petitioner counters
ied Schl. Dist., 929 P.2d 582, 592 (Cal. 1997). Providing “‘half of the - 123 - truth may obviously amount to a lie, if it is understood to be the whole.’” Id. at 592 (quoting Prosser & Keeton, The Law of Torts, Misrepresentation and Nondisclosure, sec. 106, at 738 (5th ed. 1984)). Respondent, having disclosed some of the facts concerning the irregularities in the test case procedure, was obliged to disclose all facts that would materially qualify the limited facts that were disclosed. See id. a
ied Schl. Dist., 929 P.2d 582, 592 (Cal. 1997). Providing “‘half of the - 123 - truth may obviously amount to a lie, if it is understood to be the whole.’” Id. at 592 (quoting Prosser & Keeton, The Law of Torts, Misrepresentation and Nondisclosure, sec. 106, at 738 (5th ed. 1984)). Respondent, having disclosed some of the facts concerning the irregularities in the test case procedure, was obliged to disclose all facts that would materially qualify the limited facts that were disclosed. See id. a
ied Schl. Dist., 929 P.2d 582, 592 (Cal. 1997). Providing “‘half of the - 123 - truth may obviously amount to a lie, if it is understood to be the whole.’” Id. at 592 (quoting Prosser & Keeton, The Law of Torts, Misrepresentation and Nondisclosure, sec. 106, at 738 (5th ed. 1984)). Respondent, having disclosed some of the facts concerning the irregularities in the test case procedure, was obliged to disclose all facts that would materially qualify the limited facts that were disclosed. See id. a
ied Schl. Dist., 929 P.2d 582, 592 (Cal. 1997). Providing “‘half of the - 123 - truth may obviously amount to a lie, if it is understood to be the whole.’” Id. at 592 (quoting Prosser & Keeton, The Law of Torts, Misrepresentation and Nondisclosure, sec. 106, at 738 (5th ed. 1984)). Respondent, having disclosed some of the facts concerning the irregularities in the test case procedure, was obliged to disclose all facts that would materially qualify the limited facts that were disclosed. See id. a
106-656 provides that its purpose "shall be to assure the manufacturer, distributor, and consumer of the correct quality and quantity of all commercial fertilizer sold in this State". The Virginia Commercial Fertilizer Law, Va. 6 Code Ann. sec. 3.1 (Michie 1994), is substantially the same as the North Carolina fertilizer law for purposes of t
Section 106 "works in conjunction with section 104(a)(3) and section 105(a)" by excluding from an employee's gross income the cost of employer-provided coverage under an accident or health plan. Rabideau v. Commissioner, T.C. Memo. 1997-230; see sec. 1.106-1, Income Tax Regs. If employer contributions are excluded from gross income under section 10
However, section 106 requires, by its terms, that the employer’s contributions (here, Kenmore’s payments of premiums to Blue Cross) be for compensation to the employer’s employees.
at 917. The Act further directed the Secretary to establish criteria to guide state efforts “for the preservation, acquisition, and development of such properties,” id. § 101(a), and the President to “issue such regulations . . . as he deems desirable” in order “to assure consistency in policies and actions under this Act with other
ence or disregard ofrules or ¹³Petitioners also suggest that at least a portion ofthe annual contributions is attributable to providing a group-term life insurance benefit covered by sec. 79, and health expense reimbursement benefits are covered by sec. 106. We reject this argument. We have previously concluded that the Machacek, Inc. SBP did not provide group-term life insurance covered by sec. 79. The allocation offunds to the notional accounts to fund the purported health expense reimbursemen
§ 105 states that amounts received by an employee through accident or health insurance for pe sonal injuries or sicknéss shall be included in gr ss income to the extent such amounts (1) are attrib- utåd -to contributions by the employer which were anot inŠludible in the gross income of the employee or (2 are paid by the employer .
DKD never had an accident or health irisur- ang plan. DKD simply rote checks to a health in- surer, allegedly>on behalf of [Ms.] Dursky. Also, I.R.C. § 105 states that amounts received by an employee through accident or health insurance for pe sonal injuries or sicknéss shall be included in gr ss income to the extent such amounts (1) ar
A contribution by an employer to an accident or health plan described in section 106 includes a payment that such employe r "Sec .
Under section 106, “an employee’s gross income does not include employer-provided coverage (e.g., accident and health insurance premiums) under an accident and health plan.” Rugby Prods. Ltd. v. Commissioner, 100 T.C. 531, 535 (1993). The employer may provide coverage under an accident or health plan by paying the premium (or a portion of the premium) on
Under section 106, “an employee’s gross income does not include employer-provided coverage (e.g., accident and health insurance premiums) under an accident and health plan.” Rugby Prods. Ltd. v. Commissioner, 100 T.C. 531, 535 (1993). The employer may provide coverage under an accident or health plan by paying the premium (or a portion of the premium) on
Under section 106, “an employee’s gross income does not include employer-provided coverage (e.g., accident and health insurance premiums) under an accident and health plan.” Rugby Prods. Ltd. v. Commissioner, 100 T.C. 531, 535 (1993). The employer may provide coverage under an accident or health plan by paying the premium (or a portion of the premium) on
Under section 106, “an employee’s gross income does not include employer-provided coverage (e.g., accident and health insurance premiums) under an accident and health plan.” Rugby Prods. Ltd. v. Commissioner, 100 T.C. 531, 535 (1993). The employer may provide coverage under an accident or health plan by paying the premium (or a portion of the premium) on
Under section 106, “an employee’s gross income does not include employer-provided coverage (e.g., accident and health insurance premiums) under an accident and health plan.” Rugby Prods. Ltd. v. Commissioner, 100 T.C. 531, 535 (1993). The employer may provide coverage under an accident or health plan by paying the premium (or a portion of the premium) on
Petitioner does not claim that Ingram’s contributions to the plan on his behalf were includable or included in his gross income for any year, and the version of section 106 in effect during the relevant periods suggests that they were not.