IRS Notice 2017-71

IRS Notice 2017-71 addresses the tax implications for employees who receive employer-funded health coverage through a Health Reimbursement Arrangement (HRA) or similar plans. The notice clarifies that such reimbursements can be considered taxable income if the health insurance is provided outside of the employer’s group plan. The IRS emphasizes that employers must comply with the Affordable Care Act (ACA) regulations when offering these arrangements. Essentially, it informs both employers and employees about how to properly account for and report these benefits to ensure proper tax treatment under the law.