The beginning of the accounting cycle (and the accounting process as a whole) is the identification and analysis of business transactions and economic events. Take note that businesses deal with numerous transactions and events, but not all of them will be included in the accounting cycle.
A Health Reimbursement Arrangement (HRA), commonly referred to as a Health Reimbursement Account, is an IRS approved, employer-funded, tax-advantaged employer health benefit plan that reimburses employees for out-of-pocket medical expenses and individual health insurance premiums. A Health Reimbursement Arrangement is not health insurance. A Health Reimbursement Arrangement allows the employer to make contributions to an employee's account and provide reimbursement for eligible expenses. An HRA plan is an excellent way to supplement health insurance benefits and allow employees to pay for a wide range of medical expenses not covered by insurance.
Tax Treatment of HRAs Generally. An HRA is an arrangement that: (1) is paid for solely by the employer and not. provided pursuant to salary reduction election or otherwise under a Â§ 125 cafeteria. plan; (2) reimburses the employee for medical care expenses (as defined by Â§ 213(d) of.