OTC in Medical Reimbursement Plan

[LTaxes]

In a C-Corp, can they reimburse employees for OTC meds and medical miles under a medical reimbursement plan?

Thanks!

[Armando Beaujolais]

In a C-Corp, can they reimburse employees for OTC meds and medical miles under a medical reimbursement plan?

Thanks!

I don't have my cites in front of me, but the expenses allowed under a MRP are the same ones allowed for itemized deduction purposes, so the answer is "Sometimes."

[Bees Knees]

Not exactly correct. For the most part. However, TTB, page 13-28 says "Expenses that qualify for tax-free reimbursements are those that would otherwise qualify for a medical expense deduction. Tax-free reimbursements can also apply to nonprescription drugs, but not to dietary supplements that are merely beneficial to the general health of the employee (Rev. Ru. 2003-102)."

So you can reimburse the cost of aspirin tax-free even though it is not deductible on Schedule A.

[veritas]

see rev ruling 2003-102

Reimbursements by an employer of amounts paid by an employee for medicines and drugs purchased by the employee without a physician’s prescription are excludable from gross income under § 105(b). However, amounts paid by an employee for dietary supplements that are merely beneficial to the general health of the employee or the employee’s spouse or dependents, are not reimbursable or excludable from gross income under § 105(b).

I tried to copy the whole ruling from a pdf file but can't upload a 48k file.

[LTaxes]

Thanks so much for your prompt replies. I thought there was a a caveat somehere in there and it's dietary supplements. Great!