Definition

VEBA (501(c)(9))

A voluntary employees' beneficiary association used to fund employee welfare benefits.

Full definition

A VEBA is a tax-exempt trust under IRC §501(c)(9) used to provide life, sickness, accident, or other welfare benefits to members and dependents. VEBAs are an alternative — not a substitute — for 401(h) accounts and have different funding, deduction, and nondiscrimination rules.

Related terms

401(h) Account

A separate sub-account inside a qualified pension or annuity plan used to pay certain retiree medical benefits.

Health Reimbursement Arrangement (HRA)

An employer-funded arrangement that reimburses employees for qualified medical expenses.

Availability, tax treatment, and plan design depend on the facts and circumstances of the employer, plan document, participant group, and applicable law. 401h.com provides general educational information only — not tax, legal, actuarial, investment, or ERISA advice. Consult qualified tax, legal, actuarial, and plan professionals.