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the participant has notice or knowledge of the plan. Wigutow v.
Commissioner, T.C. Memo. 1983-620.
In the instant case, a plan (as defined in section
1.105-5(a), Income Tax Regs.) existed. Hillside Dairy adopted a
written medical reimbursement plan identifying who was eligible
to participate, what expenses would be reimbursed, and how
participants were to make claims for reimbursement. The plan was
adopted at the first meeting of the board of directors.
Mr. Schmidt had knowledge of the medical reimbursement plan
as well as the health insurance policy. Moreover, there is no
doubt that the medical reimbursements provided under the written
plan were intended to complement benefits provided by health
insurance. Thus, the corporation’s medical plan included health
insurance as well as the medical reimbursements. And finally, we
are satisfied that the corporation’s medical plan was for Mr.
Schmidt as an employee of Hillside Dairy, and not for his benefit
as one of the corporation’s shareholders.
Plans limited to employees who are also shareholders are not
per se disqualified under section 105(b). Larkin v.
Commissioner, supra at 635 n.5. In this regard, we have
sustained plans for corporate officers who were also shareholders
because those officers had central management roles in conducting
the business of the corporation. Wigutow v. Commissioner, supra;
Epstein v. Commissioner, T.C. Memo. 1972-53; Seidel v.
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