Prior to the pandemic, ultra-low unemployment at roughly 3.3% put a spotlight on ‘lifestyle benefits’ for employees such as gym memberships and pet sitting. When the COVID-19 crisis hit, the focus immediately shifted for many plan sponsors. Some employers are now offering high-deductible health plans (HDHPs) paired with health savings accounts (HSAs). Scaling back on company matches to 401(k) plans and contributions to profit sharing accounts are two other areas where employers are trying to save money, said Lisa Loesel, an employee benefits partner at McDermott. “Depending on what kind of plan they have and the terms set forth for them, we have seen plan sponsors delay the timing of their contributions, change the amount, move from a fixed to a discretionary amount or even cut their contributions indefinitely,” Loesel said in a recent article for PLANSPONSOR Magazine. Among sponsors offering a pension plan, more are de-risking their plans. “The market...
To help cafeteria plan participants address challenges arising from the COVID-19 crisis, the Internal Revenue Service recently issued guidance allowing employers to make a number of participant-friendly changes under their cafeteria plans. While employer adoption of these more flexible rules is voluntary, plan sponsors should work with third-party administrators, insurance providers and legal advisors to ensure that the new provisions are properly adopted, documented and communicated. Access the full article.
The Internal Revenue Service (IRS) recently announced cost-of-living adjustments to the applicable dollar limits for health savings accounts (HSAs) and high-deductible health plans (HDHPs) for 2021. Some of the dollar limits currently in effect for 2020 will change for 2021. Access a table comparing the applicable dollar limits.
In the ongoing effort to help individuals impacted by COVID-19, Congress passed the Coronavirus Aid, Relief, and Economic Securities Act (CARES Act) on March 27, 2020. The President signed the CARES Act into law the same day. The historic stimulus package provides wide-ranging relief for both employers and employees. This includes rules that impact health and welfare, retirement and executive compensation plans and programs. For more information about the impact of the CARES Act on employer-provided benefits, access our On the Subject articles on the: Impact of the CARES Act on Health and Welfare Benefits Impact of the CARES Act on Retirement Plans and Student Loan Benefits Impact of the CARES Act on Executive Compensation In addition, for information about the frequently asked questions regarding health and welfare, retirement and executive compensation issues in the COVID-19 era, access our FAQs.
A new IRS notice will allow individuals to receive testing and care for COVID-19 without jeopardizing their ability to contribute to a health savings account (HSA). The IRS issued the notice due to the public health threat posed by COVID-19, and the stated need to eliminate potential administrative and financial barriers to testing for and treatment of COVID-19. Access the full article.
Recently the Internal Revenue Service (IRS) and the Social Security Administration announced the cost-of-living adjustments to the applicable dollar limits on various employer-sponsored retirement and welfare plans and the Social Security wage base for 2020. In the article linked below, we compare the applicable dollar limits for certain employee benefit programs and the Social Security wage base for 2019 and 2020. Access the full article.
The Internal Revenue Service (IRS) recently announced cost-of-living adjustments to the applicable dollar limits for health savings accounts and high-deductible health plans for 2020. Nearly all of the dollar limits currently in effect for 2019 will change for 2020. See a comparison of the applicable dollar limits for HSAs and HDHPs for 2019 and 2020. Access the full article.
Recently the Internal Revenue Service (IRS) and the Social Security Administration announced the cost-of-living adjustments to the applicable dollar limits on various employer-sponsored retirement and welfare plans and the Social Security wage base for 2019. The table below compares the applicable dollar limits for certain employee benefit programs and the Social Security wage base for 2018 and 2019.* UPDATE: On Thursday, November 11, 2018, the Internal Revenue Service announced that, for calendar year 2019, the annual maximum salary reduction limit for contributions to a health flexible spending account was increased by $50 to $2,700. RETIREMENT PLAN LIMITS 2018 2019 Annual compensation limit $275,000 $280,000 401(k), 403(b) & 457(b) before-tax contributions $18,500 $19,000 Catch-up contributions (if age 50 or older) $6,000 $6,000 Highly compensated employee threshold $120,000 $125,000 Key employee officer compensation threshold $175,000 $180,000 Defined...
On April 26, 2018, the Internal Revenue Service (IRS) increased the 2018 maximum deductible Health Savings Account (HSA) contribution for taxpayers with family coverage under a High Deductible Health Plan (HDHP) to $6,900. The $6,900 contribution limit for 2018 was originally published in Revenue Procedure 2017-37, but was reduced earlier this year by $50 to $6,850 in Revenue Procedure 2018-18 due to changes in the inflation indexing measure under the Tax Cuts and Jobs Act. The IRS later increased the limit back to the originally announced amount of $6,900. This relief is published in Revenue Procedure 2018-27 and appears to be the result of pushback from employers, many of whom would face significant administrative costs due to implementing the mid-year change, and governing law requiring the annual HSA limits to be published by no later than June 1 of the preceding calendar year. Under the guidance, an individual who received a distribution from an HSA in...
In a recent webinar, Jake Mattinson and Sarah Raaii discussed the basics of health savings accounts (HSAs) and health flexible spending accounts. They provided an overview of the various regulations surrounding HSA, such as eligibility requirements, high deductible health plans, and contributions and distributions, and cafeteria plans. Additionally, they analyzed the differences between HSAs and Health FSAs and HRAs. View the full presentation.