419(e) Post-Retirement Medical Reimbursement Plan
Basics: Employees receive a valuable employer-provided benefit while the employer receives a current tax deduction.
Funding: Tax-deductible contributions allow employers to use pre-tax dollars to fund a reserve account for post-retirement and long-term health care benefits.
Non-discrimination Requirement: The benefit must be offered to all full-time employees meeting a nondiscriminatory minimum age and service requirement.
Qualified or Nonqualified: Not a qualified plan. There are no premature withdrawal penalties, minimum distributions or maximum contribution or compensation limits.
Traditional Defined Benefit vs. 412(i) Fully Insured Plan
Traditional Plan 412(i) Plan
Limited early contributionsLarger early contributions
May become over-/under-funded Always fully funded
Quarterly contribution deadlines Funding extended to tax filing deadline