S-Corp Health Benefits for 2%+ AND regular employees

[SunTaxMan]

I was just doing some research into this subject today and found:

http://www.irs.gov/businesses/small/articl...=101065,00.html

I don't see any reference to, or requirement for, establishment of a cafeteria plan to handle health insurance as a company paid benefit. Am I missing something?

Thanks,

[RoyDaleOne]

Health Plans

If an employer pays the cost of an accident or health insurance plan for his/her employees, including an employee’s spouse and dependents, the employer’s payments are not wages and are not subject to Social Security, Medicare, and FUTA taxes, or federal income tax withholding. Generally, this exclusion also applies to qualified long-term care insurance contracts. However, the cost of health insurance benefits must be included in the wages of S corporation employees who own more than two percent of the S corporation (two percent shareholders).

There is no requirement for a written plan for this type of insurance provide 100% of the benefits are provided by insurance.