📝 Overview
A Qualified Small Employer Health Reimbursement Account (QSEHRA) allows small employers to provide non-taxable reimbursements for certain health care expenses to their employees. In some states, a QSEHRA also allows small employers to offer additional plan choices without the need for a group health plan.
🔑 Eligibility Requirements
To offer a QSEHRA, the following conditions must be met:
Your company must have fewer than 50 full-time employees.
You must offer the arrangement on the same terms to all full-time employees. Reimbursement amounts may only vary based on age and the number of individuals covered.
You cannot offer a group health plan alongside the QSEHRA, such as SHOP coverage or a Flexible Spending Account (FSA).
📊 W-2 Reporting
QSEHRA amounts recorded in DaySmart Payroll are mapped to Box 12, Code FF on the employee's W-2.
❓ Frequently Asked Questions (FAQs)
Find answers to common questions or additional details that may not be covered in the main instructions.
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What is the difference between a QSEHRA and a group health plan?
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A QSEHRA is a reimbursement arrangement, not an insurance plan. Instead of providing a group health plan directly, you reimburse employees for eligible health care expenses up to an annual limit. A group health plan, such as SHOP coverage, is a traditional employer-sponsored insurance policy. You cannot offer both at the same time.
Can part-time employees be included in a QSEHRA?
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The eligibility requirement specifies that the arrangement must be offered on the same terms to all full-time employees. Whether part-time employees are included is a separate determination. If you have questions about part-time eligibility, contact DaySmart Support for guidance.
Can reimbursement amounts vary between employees?
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Yes, but only in limited ways. Reimbursement amounts may vary based on the employee's age and the number of individuals covered under their plan. They cannot vary based on other factors such as job title, salary, or tenure.
Where does the QSEHRA amount appear on the W-2?
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Click the arrow to see the answer
QSEHRA amounts are reported in Box 12 of the W-2 using Code FF. This is automatically mapped when the amount is recorded in DaySmart Payroll.