Executive Summary: The Department of Health and Human Services (“HHS”) recently announced that full implementation of the SHOP component of the state-based health insurance exchanges created by the Affordable Care Act (the “ACA”) run in full or in part by the federal government will be delayed until 2015. States setting up their own exchanges will be given the option to elect to similarly delay full implementation of their SHOPs until 2015.
Articles about the Employee Retirement Income Security Act (ERISA) and other issues relating to employee benefit topics
Executive Summary: The Department of Labor (“DOL”) recently released a series of final rules affecting health benefits provided through multiple employer welfare arrangements (“MEWAs”). Notably, the 2012 Form M-1 filing deadline has been extended to May 1. In addition, new guidance implementing portions of the Affordable Care Act (“ACA”) applicable to MEWAs has been released.
With 2013 in full swing, now is an excellent time to begin preparing for the changes that will take place as a result of the Affordable Care Act. Although most of these changes are set to take place in 2014, there is one important change that is right around the corner. Beginning on March 1, 2013, all employers with 50 or more full-time employees will be required to provide each employee at the time of hiring ‘ or, with respect to current employees, not later than March 1, 2013’ with written notice, in plain language, of certain provisions of the Affordable Care Act, including
Executive Summary: The U.S. Department of Health and Human Services (“HHS”) recently released long-awaited final HIPAA Regulations. The new regulations finalize many changes previously proposed to the Privacy, Security, and Enforcement Rules, and modify the Breach Notification Rule initially adopted in August 2009. In addition, the new regulations extend HIPAA application to Business Associates.
Executive Summary: As most everyone knows by now, Congress adopted, and President Obama signed, legislation – the American Taxpayer Relief Act (the “Act”) – that resolves many elements of the so-called “fiscal cliff,” i.e., the various tax increases and expiration of tax breaks, along with spending cuts, that were to have become effective with the new year. Much has been written and reported about applying the scheduled tax rate increases only to high-income taxpayers, changing the Alternative Minimum Tax so that it would not penalize the “middle class,” increasing estate tax for certain “large” estates, allowing the 2011 payroll tax cut to expire (along with other scheduled payroll tax increases), and other “newsworthy” aspects of the Act. Little has been mentioned, however, about the Act’s provisions applicable to benefit plans and programs. So here are a few of those provisions.
Executive Summary: In Announcements 2012-45 and 2012-46, the IRS has temporarily eased the eligibility requirements for employers to participate in the employment-tax Voluntary Classification Settlement Program (“VCSP”) that was begun last year. (See our Legal Alert dated 9/27/2011.) Specifically, employers may participate in a slightly modified version of the program (the “Modified VCSP”) even if they haven’t filed all required Forms 1099, as is required for the VCSP. In addition, the prohibition against participation by taxpayers under audit and the requirement to extend the limitations period for future assessments were both changed for purposes of the Modified VCSP.
Executive Summary: In addition to the other various employee benefit plan relief provided as a result of Hurricane Sandy, on November 16 the Internal Revenue Service announced, in Announcement 2012-44, that certain individual account plans, including Section 401(k) plans, Section 403(b) tax-sheltered annuities, and governmental Section 457(b) deferred compensation plans can provide plan loans and hardship withdrawals (including “unforeseeable emergency” distributions under 457(b) plans) to those participants who were (or who have certain family members who were) adversely affected by Hurricane Sandy. In addition, IRA owners may also qualify to receive distributions with reduced administrative procedures.
Executive Summary: With the reelection of President Obama, health care reform is here to stay. Challenges to the law are still pending; however, employers need to comply with existing requirements and begin preparations for compliance with future requirements. In addition, new guidance and regulations are likely imminent.
Executive Summary: The Pension Benefit Guaranty Corporation (“PBGC”) has adopted a new pilot program to enforce section 4062(e) of the Employee Retirement Income Security Act (“ERISA”) that targets at-risk pension plans. The change comes in response to President Obama’s Executive Order No. 13563, which asked federal agencies to review existing and pending regulations for possible modification or elimination.
The Internal Revenue Service has released a detailed list of pension plan and other retirement-related contribution limitations for Tax Year 2013 that were triggered by increases to the cost of living. A number of the pension plan limitations will change for 2013 because the increase in the cost-of-living index met the statutory thresholds for the adjustment. Other limitations, however, will remain unchanged.
On October 18, 2012, the Internal Revenue Service announced cost of living adjustments affecting various limitations applicable to pension and other retirement plans (IR 2012-77). Many of the limitations remain unchanged because they are indexed in $1000 or $5000 increments, but several will change for 2013. Some of the better-known limitations are:
Executive Summary: The Form 5500, Annual Return/Report of Employee Benefit Plan, is used to report information concerning employee benefit plans and must be filed by the last day of the 7th calendar month after the end of the plan year, which is July 31, 2012 for calendar year plans.
Today, in a 5-4 decision, the U.S. Supreme Court upheld the individual mandate provision of the 2010 Patient Protection and Affordable Care Act (PPACA) as a valid tax, imposed within Congress’ taxing power. See Nat’l Federation of Independent Businesses v. Sebelius (No. 11-393, June 28, 2012). The Court held that the individual mandate (which requires most Americans to purchase insurance or face an IRS tax) is not a penalty because the only consequence of not complying with the mandate is the requirement to pay the tax. Although the Court also held that Congress exceeded the power granted to it under the Commerce Clause when it enacted the individual mandate, the provision is nevertheless valid under Congress’ taxing authority. The Court also held that the Anti-Injunction Act does not preclude the Court from ruling on the issue because the PPACA does not require that the penalty for failing to comply with the individual mandate be treated as a tax for the purposes of the Anti-Injunction Act. Chief Justice Roberts authored the majority opinion.
As an employee reaches retirement age, he may want to retire or cease working full-time. The employer, however, may need or want the employee to continue to work temporarily or on a part-time basis. The employee wants to begin to receive his pension plan payments. A frequent question in this scenario is, â€œCan we employ the participant part-time or for a few more months, but begin the employeeâ€™s pension payments?â€
The Internal Revenue Service recently announced its cost-of-living adjustments applicable to dollar limitations for retirement plans and Social Security generally effective for Tax Year 2012 (see IR 2011-103). Notably, the limitation on annual salary deferrals into a 401(k) plan will increase from $16,500 to $17,000. The dollar limits are as follows: