Another great tax perk for the self-employed business owner is the ability to write off medical expenses. When an individual simply claims the medical expense tax credit, they are first required to reduce the claim by their calculated threshold, and the remaining amount only qualifies for the non-refundable tax credit. In a lot of cases this medical expense tax credit is actually worthless. When claimed through medical plan, even a cost plus account, there is no threshold deduction. The entire amount become a non-taxable benefit to the employee and a tax write-off to the company. When selecting compensations packages, every company should carefully consider the advantage of this setup. A $5,000 raise to employees in the highest tax bracket would result in roughly half of their income going to tax and only a $2,500 benefit to the individual. A $5,000 raise through Group Medical Benefits would result in zero tax and the $5,000 benefit to the individual. Whatever your needs, our advisor referral network can work with us to achieve the most effective non-taxable employment income benefit structure.
