Church benefit plans

QSEHRA: Qualified Small Employer HRA

An IRS-approved health benefit for churches with fewer than 50 full-time employees that don’t offer group health insurance.

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QSEHRA plan package cover with plan pages

Health benefits without the cost and complexity of a group plan

With a QSEHRA, your church sets a monthly allowance and reimburses eligible employees tax-free for individual health insurance premiums and qualified medical expenses. Employees choose the coverage and care that fit their needs, and the church’s costs stay predictable within IRS limits.

  • Fewer than 50 employeesFull-time employees, no group plan
  • 2026 limitsUp to $6,450 individual, $13,100 family
  • Tax-free reimbursementsNot subject to income or payroll taxes
  • Plan documents includedPrepared for your church
Quick check

Is this the right plan for your church?

  1. Are you covering just one employee, such as your pastor?Yes: the One-Person HRA is built for that. No: go to question 2.
  2. Do you offer a group health plan to any employees?Yes: a QSEHRA isn’t allowed, but a CHOICE Arrangement can cover employee classes that aren’t on the group plan. No: go to question 3.
  3. Do you have fewer than 50 full-time employees?Yes: a QSEHRA (IRS limits, same terms for everyone) or a CHOICE Arrangement (you set the amounts by employee class). No: a CHOICE Arrangement.

Still unsure? Our guide Health Benefits for Churches walks through the decision, or book a Pro Advisor HRA session.

Why consider a QSEHRA

Meaningful benefits, predictable costs

Meaningful benefitsOffer real health benefits without sponsoring a group plan.
Predictable costsDefined contribution limits keep costs under control.
Employee choiceEmployees choose the coverage and care that fit their needs.
Tax-advantagedReimbursements aren’t subject to federal income or payroll taxes.
What can be reimbursed

Premiums and qualified medical expenses

  • Individual health insurance premiums
  • Co-pays and deductibles
  • Prescription medications
  • Vision care, exams, glasses and contacts
  • Dental care
  • Chiropractic and other eligible treatments
  • Long-term care services
  • Certain over-the-counter medications (based on plan design)
Who it’s for

Eligibility and plan requirements

  • Fewer than 50 employees. Full-time employees, and no group health plan for anyone.
  • Same terms for all. Limited variations allowed for family size or age.
  • Employer-funded. Employees can’t contribute.
  • Minimum essential coverage. Required for tax-free reimbursements.

2026 annual limits: up to $6,450 for individual coverage and $13,100 for family coverage, prorated for partial years.

Example in numbers

What tax-free reimbursement is worth

Suppose the church offers a $450 monthly allowance, within the 2026 individual limit, and an employee uses it for health insurance premiums: $5,400 for the year.

Through the QSEHRA

  • Reimbursed to the employee$5,400
  • Federal income tax$0
  • Employee Social Security & Medicare$0
  • Church Social Security & Medicare$0
  • Employee keeps$5,400

Paid as extra salary instead

  • Added to pay$5,400
  • Federal income tax (12% bracket)$648
  • Employee Social Security & Medicare (7.65%)$413
  • Church Social Security & Medicare (7.65%)$413
  • Employee keeps$4,339

Illustration only, for a non-minister employee in the 12% federal bracket; state income tax not included. Ministers pay self-employment tax instead of Social Security and Medicare withholding, so their savings differ. Our team can run the numbers for your church.

Plan ahead

When to get started

  1. 1Order your planAllow time for the enrollment form and benefits advisor review.
  2. 2Give employees noticeEmployees receive a written notice at least 90 days before the plan year begins. For a January 1 plan year, that’s by early October.
  3. 3Plan year beginsEmployees can be reimbursed for eligible expenses.

The plan year doesn’t have to follow the calendar year. Ask us about other start dates.

How it works

Three simple steps

  1. 1Order in our storeAdd the plan to your cart and complete the enrollment form about your church.
  2. 2Benefits advisor reviewAn advisor checks your submission for accuracy, completeness and IRS compliance.
  3. 3Receive your plan packageYour plan document, SPD and forms arrive with easy signing instructions.

Order your plan

What you receive

Your plan package

Prepared for your church and kept on file for compliance.

Resolution to adoptMeeting minutes recording the church’s decision to establish the plan as an employee benefit.
Customized plan documentThe rules, benefits and terms of your plan, prepared for your church and kept on file for IRS review.
Summary Plan DescriptionAn easy-to-read guide for employees with the federally required disclosures.
Election and claim formsPersonalized forms for employees to join the plan and submit expenses for reimbursement.

HRA Support Plan for Churches

Setting up the plan is the first step. Keeping it compliant takes ongoing attention. Add year-round help with eligibility questions, reimbursement rules, required plan updates, employee documentation and payroll reporting.

See the HRA Support Plan

Compare HRA plans

Which HRA fits your church?

CHOICE Arrangement
(formerly ICHRA)		 QSEHRA One-Person HRA
Best for Churches of any size that want to reimburse individual health coverage Churches with fewer than 50 full-time employees and no group health plan Churches reimbursing one employee, often the pastor
Contribution limits The church sets the amounts IRS annual limits apply The church sets the amounts
Employee groups Can vary by class of employee Same terms for all eligible employees One employee
Learn more CHOICE Arrangement You are here One-Person HRA

Not sure which one fits? Our guide Health Benefits for Churches compares all three with a decision flowchart, church examples and a cost comparison workbook.

Related resources

Helpful next steps

Health Benefits for Churches guideCompares the QSEHRA, CHOICE Arrangement and One-Person HRA, with a decision flowchart, church examples and a cost comparison workbook.Pro Advisor HRA sessionA 30-minute one-on-one session with our team to talk through your church’s situation.HRA Support PlanYear-round help keeping your plan compliant after it’s set up.All church benefit plansPremium Only Plan, Health FSA, Dependent Care Assistance Plan and more.
FAQ

Common questions

What if an employee starts mid-year?
Their maximum benefit is prorated by the months they’re eligible. Monthly allowances can’t be increased to catch up to the full annual amount.
Can a church with a group plan offer a QSEHRA?
No. A QSEHRA is only for employers that don’t offer a group health plan to any employee. A CHOICE Arrangement may be a better fit. See the comparison above.
Do employees need health insurance?
Yes. Employees need minimum essential coverage for reimbursements to be tax-free.
Do I need the HRA Support Plan?
It’s optional. It gives you year-round help with eligibility, mid-year hires, reimbursement rules and W-2 reporting.
I already ordered. Where do I find my order?
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Ready to set up your QSEHRA?

Order in our store, or schedule a conversation with our team. Questions? Call (888) 421-0101.

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