Before employers implement their proposed workforce changes resulting from the finalization of the new overtime rule, released September 24, 2019, see our article for more information, employers should consider what impact those proposed workforce changes may have on their employee benefit plans. Employee benefit plans with criteria for eligibility, contribution, etc. based on the classification … Continue Reading
Penalties and fines for non-compliance with Washington, D.C.’s law requiring D.C. employers to offer commuter benefits to their D.C. employees will take effect beginning on November 14, 2019. The law, which became effective on January 1, 2016, requires employers with at least 20 employees in D.C. to offer commuter benefits to their covered employees. Please … Continue Reading
On September 23, 2019, the Treasury Department and IRS published final regulations for hardship distributions from both 401(k) and 403(b) plans (the “Final Regulations”). Essentially the hardship distributions changes relax the hardship distribution requirements (i.e., making it easier for participants to obtain hardship distributions) and eliminate many burdens following a hardship distribution (i.e., allowing participants … Continue Reading
The Department of Labor recently issued a fact sheet intended to help employers understand their retirement plan obligations under the Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”). The law provides that eligible employees that return to employment following qualified military service must be treated as though their military service was not a … Continue Reading
As imagined by plan sponsors of closed defined benefit pension plans, the IRS issued Notice 2019-49, the fifth extension for an additional year of the temporary nondiscrimination relief for “closed” defined benefit pension plans originally announced by the IRS during 2014. The extended relief applies to plan years beginning before 2021 for those “closed” plans … Continue Reading
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
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
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
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
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
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
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
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 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
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
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 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
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
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
Premiums for Affordable Care Act (ACA) marketplace coverage continue to sky rocket, with the average cost of a benchmark plan in the individual market place rising 20% this year. There is very different news for employer-sponsored plans. According to the nonprofit Kaiser Family Foundation, in 2016 annual family premiums rose on average a modest 3% … Continue Reading
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
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
The Internal Revenue Service (“IRS”) has recognized that marriages of couples of the same sex should be treated the same as marriages of couples of the opposite sex for federal tax purposes. On September 2, 2016, the IRS issued final regulations — in furtherance of the Supreme Court’s decisions in Obergefell v. Hodges and Windsor … Continue Reading
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
