Call (239) 658-5217 today to learn how we may serve you
Formal Tax Planning

Formal Tax Planning

Tax planning using Medical Expense Reimbursement Plans (MERPs) is one of the many planning strategies that we use in our planning practice at Joseph F. Fragnoli, CPA, PC and Pinnacle Tax Planning Services, Inc.

A Section 105 medical expense reimbursement plan, or MERP, is a long-established benefit plan dating back to 1954. The MERP lets an employer reimburse employees for any eligible medical expense they incur on behalf of themselves, their spouses, and their dependents. Typically, companies that adopt a MERP will buy group health insurance for their employees, then establish a “wraparound” MERP for expenses the underlying insurance doesn’t cover. Alternatively, some employers will “self-insure” and dispense with group insurance entirely, paying costs directly out of pocket and saving the cost of an insurance company’s profit and an agent’s commission.

A MERP can cover anything that would be deductible as “medical or dental” under Code Section 213. It can also cover any type of health insurance – individual policies, Medicare and “medigap” premiums, and even long-term care coverage. This is all well-established, black-letter law, and yes, it is Obamacare (ACA) compliant.

Many people that I have proposed this program to find it too good to be true. But, it is a fully legal and compliant strategy that can save clients thousands of dollars. Implementation is not too difficult and we can provide you with the plan document. Big tax savings is what can happen when an individual or company engages in true formal tax planning.  We have all seen how the market has taken a beating at the beginning of this year.  How about making an investment in a tax plan that can make you a 400% return on your cost. If you are interested in a MERP or hearing about the other tax planning strategies that Joseph F. Fragnoli, CPA, PC and Pinnacle Tax Planning Strategies, Inc. in Nashville, TN offer that can save businesses and individuals thousands of dollars in income tax please give us a call at (615) 678-4751.