SIMRP Plan

What Is the SIMRP Plan — And What Could It Mean for Your District?

The Self-Insured Medical Reimbursement Plan (SIMRP) is a federally recognized employee benefit under IRC Section 105 and IRS Publication 15-B. It works by restructuring a portion of employee compensation as a non-taxable medical reimbursement benefit — reducing taxable income, lowering tax liability for both the employee and the district, and increasing take-home pay. There is no cost to implement, and XO Financial handles the entire process.

How It Works

  • A portion of each participating employee's compensation is designated as a non-taxable medical reimbursement benefit
  • This reduces the employee's taxable income — meaning less withheld from every paycheck
  • The district's FICA payroll tax liability is reduced on every participating employee's check
  • Employees receive a SIMRP reimbursement and see a net increase in take-home pay — even after accounting for the plan's administration fee
  • XO Financial manages all setup, implementation, and ongoing administration

What This Means for Your District

  • No cost to implement — XO Financial handles everything
  • Immediate impact — savings begin with the first participating payroll cycle
  • No reduction in employee benefits — this enhances existing compensation
  • Scalable — the more employees who participate, the greater the district's savings
  • Federally compliant — built on established IRS guidelines (IRC Section 105 / IRS Publication 15-B)
  • Gives back to your students — XO Financial donates $4 per month per participating employee directly to your district's scholarship fund, funded entirely by XO Financial

​XO Financial has helped school districts across Texas implement the SIMRP plan with zero disruption to operations. Contact us today for a no-cost, no-obligation analysis specific to your district.
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