TASC AND FAMILY FARMER WIN AUDIT AGAINST THE IRS
TASC helped a family farmer from Iowa win an IRS audit and retain the healthcare deductions he had earned through participation in AgriPlan, TASC's Section 105 Plan. Because the farmer’s health insurance policy was in the name of the farmer, the IRS was questioning whether the policy was a business or personal expense.
Section 105 Plans, such as AgriPlan and BizPlan, allow the self-employed (such as family farmers and small business owners) who are able to legitimately employ their spouse a 100 percent tax deduction for monies spent on healthcare expenses. AgriPlan and BizPlan cover expenses for health insurance and uninsured medical, dental, and vision care expenses as well as premiums for dental insurance, long-term care insurance, life, and disability income insurance for eligible employees and their families. Plan deductions are available at federal, state, and social security tax levels. AgriPlan and BizPlan also offer an industry exclusive Audit Guarantee, which support Clients - such as this one - in the event of an audit.
TASC was contacted in November of 2003 regarding the audit, and quickly moved in to provide legal support and representation. TASC paid all the attorney costs related to supporting the farmer, eventually totaling more than $15,000. The farmer has been an AgriPlan Client since 1998.
After stipulating that the spouse was indeed a bona fide employee, the audit focused solely on the question of the insurance policy. Based on facts, the judge decided that as long as the spouse was a bona fide employee of the farm, payment for the insurance policy was a business expense regardless of how it was paid or whose name the policy was issued in.
According to TASC CEO Dan Rashke, this ruling reinforces the importance of using a qualified third-party administrator. “Using a TPA like TASC, who offers a complete audit guarantee, provides the self-employed with resources they otherwise would not have when faced with an IRS audit,” says Rashke. In addition, this win further exemplifies TASC's dedication to the farming and small business communities.
For more information about AgriPlan or BizPlan, and about our unique Audit Guarantee, contact us
at 1-888-595-2261 or
microbusiness@tasconline.com.