Insights on benefits counseling and litigation issues impacting employers nationwide
IRS Notice 2020-46 addresses the tax treatment of employees who elect to have their employers donate sick, vacation or personal leave as cash payments to charitable organizations that provide relief to victims of the COVID-19 pandemic.
The Notice provides that the donated leave should be not be treated as W-2 wages to the donating employees. …
The IRS has issued specific guidance for the tax treatment of a leave-sharing arrangement that permits employees to donate PTO/ leave/vacation time in an employer-sponsored leave bank for use by other employees adversely affected by an event declared a major disaster or emergency by the President. See IRS Notice 2006-59.
TAX TREATMENT OF DONATING …
The IRS has substantially redesigned the Form W-4 to be used beginning in 2020.
New employees first paid wages during 2020 must use the new redesigned Form W-4. In addition, employees who worked for an employer before 2020 but are rehired during 2020 also must use the redesigned 2020 Form W-4.
Continuing employees who provided…
Whether a one-time voluntary separation program should be treated as an ERISA-covered severance plan depends on whether the program requires an “ongoing administrative scheme” – a requirement first established by the Supreme Court in Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987).
In Fort Halifax, the Supreme Court held that ERISA…
This is the sixth article in our series covering the various tax and employee benefits-related changes contained in the Tax Cuts and Jobs Act signed by the President on December 22, 2017.
One surprising change made by the Act, summarized below, is the elimination of the employer deduction for certain settlement payments made in the…
Below is the second article in our series covering the employee benefits-related changes contained in the Tax Cuts and Jobs Act signed by the President on December 22, 2017.
As discussed below, the Act makes several changes to the taxability and deductibility of employee fringe benefits beginning January 1, 2018.
The changes are somewhat arbitrary…
It always has been difficult to give a consistent answer as to whether informal severance arrangements have created an ERISA-covered severance plan. In Mance v. Quest Diagnostics Inc., 2017 WL 684711 (DC NJ 2017), the U.S. District Court held that Quest’s decision to provide some departing employees with severance benefits under a voluntary…
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 2016 (see IR-2015-118 ). Most notably, the limitation on annual salary deferrals into a 401(k) plan (along with the other retirement plan limitations) remains unchanged. The dollar limits are as follows:…
In a recent decision, Tolbert v. RBC Capital Markets Corp., _________ (S.D. Texas April 28, 2015), the district court wrestled with the question of how to determine whether a deferred compensation plan was a “top-hat” plan exempt from many of the substantive requirements of the Employee Retirement Income Security Act (“ERISA”).
The Fifth Circuit previously…
The Internal Revenue Service issued Revenue Ruling 2013-17 answering some, but not all, questions for employers in the wake of the US Supreme Court’s opinion that invalidated the federal law that confined marriage to a legal union between one man and one woman as husband and wife – United States v. Windsor, No. 12-307…
