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Beginning in 2020, Employers May Reimburse Health Insurance Premiums as an Alternative to a Traditional Group Health Plan (Subject to Several Requirements)

Many employers have contacted us over the years asking whether they may offer an “employer–payment plan” rather than offer a traditional group health insurance plan.  An employer-payment plan is a type of account-based plan that provides an employee reimbursement for all or a portion of the premium expense for individual health insurance coverage or other … Continue Reading

Benefits Outside the Box: Using a Charitable Foundation to Enhance Your Culture and Community

If your Company leadership is looking for an innovative employee benefit – something outside the standard employee benefit package of retirement, health, and welfare benefits, a Company-sponsored charitable foundation might be your answer.   A charitable foundation not only can further your Company culture while serving the community, but it also has tax benefits to boot. … Continue Reading

Third Circuit Joins Majority in Rejecting “De Facto Administrator” ERISA Theory

The U.S. Court of Appeals for the Third Circuit joins the Second, Seventh, Eighth, Ninth, and Tenth Circuits in declining to impose liability on alleged de facto plan administrators.  Under Section 502(c) of ERISA, a plan administrator may be liable and subject to penalties for failing to comply with a participant’s request for information which … Continue Reading

Employers Beware: SC Abolishes Common-Law Marriage

On July 24, 2019, South Carolina joined the ranks of Alabama, Pennsylvania, and others in abolishing future recognition of common law marriages in the state.  The state will continue to recognize all common law marriages in effect before this date, but they will be subject to a higher standard of proof.  On and after July … Continue Reading

A Deadline is a Bright Line: How Fessenden Narrows “Substantial Compliance” in the Seventh Circuit

Last week the U.S. Court of Appeals for the Seventh Circuit ruled that the deadline imposed under ERISA for plan administrators to decide on benefit claims is a “bright line” rule. The court held that when a plan administrator misses this deadline, the “substantial compliance” exception to statutory compliance does not apply and the plan … Continue Reading

How Multiemployer Pension Plans Continue To Extract More From Contributing Employers Than What They Bargained For

Contributing employers to multiemployer pension plans (“MEPPs”) are commonly surprised that their obligations to such a plan can extend well beyond the contributions required under a collective bargaining agreement (“CBA”) negotiated with a union.  The most significant extra-contractual obligation is withdrawal liability, a statutory exit fee imposed on employers that leave a plan that has … Continue Reading

EASTERN DISTRICT OF NEW YORK REFUSES TO ENFORCE AN ERISA ANTI-ASSIGNMENT PROVISION

The list of the federal courts of appeals enforcing unambiguous anti-assignment provisions in ERISA health benefit plans continues to grow:  almost exactly one year ago, the Third Circuit joined its sister circuits in holding “that anti-assignment clauses in ERISA-governed health insurance plans as a general matter are enforceable.” As the Third Circuit opinion noted, every … Continue Reading

A Quick Form W-4 Reminder for Employers: May 10, 2019 Deadline for Updates

The Tax Cuts and Jobs Act (the “Tax Act”) significantly changed the federal income tax rules.  Several of these changes impact income tax withholding, including changes to the tax rates and brackets, increasing the standard deduction, and eliminating personal exemptions. Normally, employees must provide their employers with an updated Form W-4 within 10 days of … Continue Reading

The IRS is on the Case – “Expansion of the Gig Economy Warrants Focus on Improving Self-Employment Tax Compliance”

The nature of work is changing with more and more individuals choosing to be “gig” workers rather than employees. This change fundamentally alters the availability of employee benefits, as well as the applicable taxation reporting and withholding requirements. It is no surprise to us that the Treasury Department has found that the underreporting of self-employment … Continue Reading

2019 Cost of Living Adjustments for Retirement Plans

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 2019 (see IRS Notice 2018-63). Most notably, the limitation on annual salary deferrals into a 401(k) plan will increase from $18,500 to $19,000. The dollar limits are as follows:   LIMIT 2018 … Continue Reading

Illinois Secure Choice Savings Program – A Mandatory Retirement Plan 

Employers in Illinois with at least 25 employees must comply with the Illinois Secure Choice Savings Program Act (Secure Choice) or offer employees an employer-sponsored retirement plan. Secure Choice is set to roll out in November 2018. Secure Choice applies to Illinois employers that do not sponsor a qualified retirement plan. The program, adopted in … Continue Reading

Blockchain Tokens as Compensation

Blockchain is a revolutionary technological tool in the way it tracks and stores data, decentralizes information, establishes trust in electronic files, and dispenses of intermediaries. This technology powers virtual currencies, also known as cryptocurrency or virtual tokens. Companies are raising money using “initial coin offerings” (ICOs) and using tokens to compensate and incentivize founders, directors, … Continue Reading

Arbitration of ERISA Claims – Update

Some of you may remember that back in 2015, we published an article entitled Arbitration of ERISA Claims – Yes You Can!  A link to that article can be found here.  In that article, we suggested that one key reason for adding ERISA claims to your arbitration agreement was to avoid class actions through the … Continue Reading

IRS Reduces HSA Contribution Amount for Current Year

In 2017, the IRS released the 2018 inflation-adjusted figures for contributions to Health Savings Accounts (HSAs).  The contribution limits for HSAs associated with High Deductible Health Plans was increased to $3,450 for individuals with self-only coverage and to $6,900 for individuals with family coverage.  In December, the President signed the tax reform bill commonly known … Continue Reading

TCB on the BIC: DOL Issues Guidance on Application of the Fiduciary Rule’s New Best Interest Contract Prohibited Transaction Exemption

On October 27, the DOL published guidance on the new prohibited transaction exemptions (“PTEs”) issued under the DOL’s rule redefining “fiduciary” in the context of providing investment advice (See “Guidance,” here). Intended as a means to provide protections to retirement investors, the Fiduciary Rule and related PTEs require all those providing retirement investment advice to … Continue Reading

How Can Employees Help Victims of Louisiana’s August 2016 Storms. . .Through an Employer Leave Donation Program or Leave Sharing Program?

Leave Donation. In mid-September, the IRS announced income tax relief for individuals who donate through their employers to aid victims of the Louisiana storms that began on August 11, 2016. See IRS Notice 2016-55 (Sept. 16, 2016). To get this special relief — similar to that provided for leave donation aid given after the September … Continue Reading

Arbitrator Slashes Annual Withdrawal Liability Payments in Underfunded Multiemployer Pension Plan Dispute

Employers who cease contributing to an ERISA multiemployer pension plan are liable for their allocable share of any underfunding, or “withdrawal liability.” For a variety of reasons, withdrawal liability has become both prevalent and significant. Indeed, the Pension Benefit Guaranty Corporation (the federal agency tasked with the enforcement and regulation of the withdrawal liability rules) … Continue Reading

The Obergefell Effect: Applying the SCOTUS Decision to Qualified Retirement and Health and Welfare Plans

On December 9, 2015, the IRS issued Notice 2015-87 [link below], which provides guidance on the application of the recent United States Supreme Court (“SCOTUS”) decision in Obergefell v. Hodges [link below] to qualified retirement and health and welfare plans. Prior to the 2013 SCOTUS decision in United States v. Windsor [link below], Section 3 of the … Continue Reading

ACA Auto-enrollment Requirement Repealed

Since the enactment of the Affordable Care Act (ACA), larger employers have wondered about an auto-enrollment provision that the ACA added to the Fair Labor Standards Act (FLSA). Under that provision, employers that are subject to the FLSA and which employed more than 200 full-time employees would have been required to automatically enroll new full-time employees … Continue Reading

EEOC Publishes Proposed Wellness Program Regulations

Today the Equal Employment Opportunity Commission (EEOC) published long-awaited proposed regulations on wellness programs (Proposed Regs) that are intended to harmonize certain provisions of the Americans with Disabilities Act (ADA) with long-standing rules concerning wellness programs applicable to group health plans under the Health Insurance Portability and Accountability Act (HIPAA), and more recently, the Affordable … Continue Reading

ACA Cadillac Tax Proposed Regs: What Treasury and IRS Are Considering

The Affordable Care Act (“ACA”) added section 4980I to the Internal Revenue Code (“Code”). Code section 4980I applies to tax years after December 31, 2017, and provides a tax on high cost employer-sponsored health coverage – if the aggregate cost of employer-sponsored coverage (referred to as “applicable coverage”) provided to an employee exceeds a statutory … Continue Reading
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