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Compliance Buzz will include comprehensive and practical updates on legislative, regulatory and court developments affecting employee benefit plans. The blog will also contain coverage on issues that impact benefits in general, and in particular, health care reform.
By Compliance on 10/31/2014 1:30 PM

The IRS has announced that the pre-tax maximum monthly elections for qualified transportation benefits will be the same for 2015 as they have been for 2014. The pre-tax maximum amounts will continue at $250 per month for parking benefits and $130 per month for transit benefits.

Under Code Section 132, the IRS allows an employer to offer a Transportation Plan to its employees. Through the plan, the employees have the right to elect or be paid for pre-tax parking and/or transit benefits. The employer can also provide employer paid bicycling benefits to those employees that do not elect parking and transit benefits.

By Compliance on 10/31/2014 11:57 AM

Clarifying guidance from federal regulators confirms that only group health plans that are “major medical” coverage owe the TR fee. Major Medical coverage is defined as a plan that provides “minimum value.” Therefore, only HRAs that are considered to be major medical coverage and provide minimum value are subject to the TR fee. However, almost all HRAs are integrated with an employer’s health plan or are spend down accounts; neither of which are considered to be major medical coverage and do not owe the TR fee.

HRAs that are integrated with the employer’s group health plan or group health plan of another employer do not provide major medical coverage and do not owe the TR fee. HRAs that allow former or active employees to spend down their HRA account balances also, by definition, do not provide major medical coverage and do not owe the TR fee.

Therefore, only employers that provide a non-integrated HRA that reimburses an unlimited amount of medical expenses for employees not enrolled in the employer's group medical plan or group health plan of another employer have HRAs that provide major medical minimum value coverage and owe the TR fee.

By Compliance on 10/30/2014 10:26 AM
The IRS has announced that the annual pre-tax election amount for an employee will be raised to $2,550 for plan years beginning on or after January 1, 2015.

Employers that amended their cafeteria plans to set the health FSA maximum at the “statutory maximum” do not need to amend their plan again since the plan can automatically be increased to the new “statutory maximum.” However, these employers will want to communicate to their employees that the maximum has been increased to $2,550 for plan year 2015.

Employers that have set the maximum health FSA election at a specific dollar amount will need to amend their cafeteria plans to change the health FSA maximum to a different amount up to the $2,550 amount if they so choose.

By Compliance on 10/30/2014 7:17 AM

Information in this posting is out of date and superseded by our latest posting on the TR fee.

Some employers need to take immediate action to register with the Department of Health and Human Services (HHS) and report the count of the covered lives under their health reimbursement arrangement (HRA) by November 15, 2014 on pay.gov. Failure to do so could result in penalties for each day not timely reported.

The affected employers are those that 1.) Provide spend down HRA accounts to active employees that are not enrolled in the employer’s health plan or the group health plan of another employer; or 2.) Provide an HRA to employees that are not enrolled in the employer’s health plan or health plan of another employer; or 3.)Provide an HRA to their employees and the employer has no group health plan.

By Compliance on 10/21/2014 11:48 AM

Information in this posting is out of date and superseded by our latest posting on the TR fee.

An HRA is a group health plan that is self-insured by the employer. Some HRAs are subject to the Transitional Reinsurance Fee starting with calendar year 2014 and payable through calendar year 2016. Employers that owe the TR fee for an affected HRA need to register with the Department of Health and Human Services and complete the new TR Fee form on www.pay.gov    no later than November 15th and pay the TR fee , either in full or as first installment payment, no later than January 15, 2015.

By Compliance on 10/21/2014 6:57 AM

Insurers in states where same sex marriage bans have been overturned may be allowing special open enrollments for employees to add their same sex spouses to the employer’s group health, dental or vision insurance plans. If this open enrollment occurs mid-plan year of the employer’s cafeteria plan, the employee can add their same sex spouse to the insurance coverage and pay premiums for that coverage tax free. However, this is a coverage change and the employee cannot change their health FSA election mid-year.

By Compliance on 10/14/2014 12:45 PM

Wisconsin’s Revenue Department has amended a prior Q&A to answer questions related to tax consequences for same sex couples.


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Recent Entries From Around Our Site

Almost No HRAs Owe TR Fee (10/31/14)
Health FSA Cap Raised to $2,550 for 2015 (10/30/14)
Step-by-Step TR Fee Report for HRAs (10/30/14)
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