Ogletree Deakins • December 20, 2013
Finally, some guidance on mid-year cafeteria plan changes that many employers have already permitted in the wake of United States v. Windsor. On December 16, 2013, the Internal Revenue Service (IRS) released Notice 2014-1, which answers questions regarding the proper treatment of cafeteria plan elections, flexible spending account (FSA) expenses, and health savings account (HSA) and dependent care assistance program (DCAP) contribution limits for same-sex married couples.
Ogletree Deakins • December 19, 2013
In furtherance of Section 902 of the American Taxpayer Relief Act of 2012 (ATRA), the Internal Revenue Service (IRS) recently issued Notice 2013-74 updating prior IRS guidance regarding so-called “in-plan” Roth conversions under 401(k), 403(b), and 457(b) retirement plans (DC Account Plans). The Notice expands on prior IRS guidance to offer participants in many DC Account Plans more flexibility to convert vested pre-tax account balances into after-tax Roth accounts.
Littler Mendelson, P.C. • December 18, 2013
The U.S. Supreme Court in Heimeshoff v. Hartford Life & Accident Insurance Co. et al. resolved a split among the circuits when it held that a contractual limitations clause in an ERISA-governed long-term disability benefits plan is enforceable even where it causes the limitations period on a claim for benefits to commence before the participant's cause of action accrues. In this case, the plan-based limitations period in which to file a disability claim lawsuit under ERISA Section 502(a)(1)(B) started to run when "proof of loss" was due under the plan, even though the participant's cause of action did not accrue, and a lawsuit could not be filed, until the plan's internal claim review process had been exhausted. Citing ERISA's important policy of enforcing plan terms as written, the Court held that the clause was enforceable.
Fisher & Phillips, LLP • December 17, 2013
The U.S. Supreme Court unanimously upheld a contractual clause that limited a participant’s ability to file a lawsuit pursuant to a long-term disability (LTD) policy. The contractual limitation was three years from the date proof of loss was required. The decision confirms that there is no requirement under the Employment Retirement Income Security Act (ERISA) that such a contractual clause be based on the time period after administrative remedies are exhausted and a participant is actually able to bring a lawsuit.
Nexsen Pruet • December 12, 2013
Year-End AmendmentsThe month of December is a bit different in 2013. Typically, we mark this time scrambling to amend 401(k), profit sharing, and money purchase plans in order to maintain their tax-qualified status. This year -- there are no required year-end amendments for this type of plan.
Cooley LLP. • December 11, 2013
Until now, employees contributing to a health care flexible spending account (FSA) were subject to a "use it or lose it" rule on the full amount they contributed to the FSA for that year (or in some cases, that year plus a "grace period" that runs through the following March 15).
Ogletree Deakins • December 10, 2013
The federal district court decision in Rochow v. Life Insurance Company of North America, No. 04-73628 (March 23, 2012) went unnoticed by most ERISA practitioners after it was issued in 2012, even though the court awarded millions of dollars in disgorged profits to a benefit claimant as appropriate equitable relief under section 502(a)(3) of the Employee Retirement Income Security Act (ERISA). Frankly, most practitioners did not take it seriously. However, now that the decision has been affirmed by the Sixth Circuit Court of Appeals in a rather incredible split decision issued on December 6, 2013, it will likely receive substantial press coverage and be roundly praised and criticized, depending on whether one represents benefits claimants or benefits plans.
Shaw Valenza LLP • December 09, 2013
The IRS made its annual determination of the standard mileage rate link is here.
Littler Mendelson, P.C. • December 09, 2013
The Department of Health and Human Services (HHS) recently announced that it will delay online enrollment in the federal Small Business Health Options Program (SHOP) Exchange for one year, until the open enrollment period for 2015, which begins November 2014. Administration officials stated that the decision was necessary as they prioritized fixes to the individual health exchange. The delay will apply to the nearly three-dozen states that declined to establish a SHOP Exchange and are relying on the federally established Exchange.
Jones Walker • December 06, 2013
For nearly three decades, individuals participating in health flexible spending account plans ("FSAs") have been subject to a "Use-It-or-Lose-It" rule. This rule generally states that individuals with unused FSA balances at the end of the plan year (or applicable 2.5-month grace period) must forfeit those amounts. On October 31, 2013, the Internal Revenue Service ("IRS") issued Notice 2013-71, which permits, but does not require, employers to amend their cafeteria plans to allow participants to "carry over" up to $500 of unused funds to the following plan year. Below is a summary of the main features of the new carryover rules: