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What is an ad hoc payment?

Updated: 10/10/2023
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10y ago

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Without a written plan in place, payments made to a sick or injured employee may be considered non-deductible distributions or "ad hoc payments". Ad hoc payments are those made by employers to sick or injured employees on a discretionary basis and not according to a pre-existing salary continuation plan. Many businesses have become successful because of their key employees.

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