User Support Forum

Medical Insurance...we have an HRA(health reimbursement account) medical plan for 2 of our employees.
Because of that we promise, as their employer, to pay the first $5000 of their medical expense.
Therefore we have to setaside $10,000 for that purpose and use it as the bills come in.

Would I create another fund (because this is designated $) or
should I put it with our Liabilities?

Thanks for your help in advance

Actually, you would put the $10,000 in an Asset account until you spend it.

If you have a separate account at the bank, then create another bank account number in PowerChurch.

If the $10,000 is sitting in your checking account, just create a sub-account under checking. (That's what I would do). Something like 01-1110-001 HRA

To keep track of how much of the $5,000 you have used toward Employee A, this is what I would do.

Create a GROUP ACCOUNT, level 4, HRA EXPENSE 01-5400-000
Under that, create detail accounts for each employee.
Employee A, detail expense, level 6 01-5402-000
Employee B, detail expense, level 6 01-5404-000

or

use sub-accounts:
Employee A, detail expense, level 6 01-5400-001
Employee B, detail expense, level 6 01-5400-002

When you pay a bill for Employee A:
CR 01-1110-001 HRA
DB 01-5400-001 Employee A

That way, your HRA money comes directly out of checking without any extra account transacting.