In response to the coronavirus pandemic, the IRS is allowing employers to permit their employees to change their health coverage elections or dependent care elections during the year and is extending the carryover period for health flexible spending arrangement (FSA) expenses.
For employees to evaluate the true tax benefits, they must understand the wellness programs and plans being offered.
The IRS released additional guidance on the effect of the Supreme Court’s same-sex marriage decision on qualified retirement plans and health and welfare benefit plans, including Sec. 125 cafeteria plans.
Proposed changes to the rules for when a taxpayer can revoke health care coverage in a cafeteria plan and how to measure the lookback period for determining who is a full-time employee when an employee moves positions within the same employer group.
The IRS will now permit companies to amend their cafeteria plans to allow participants in health FSAs who do not use all of the money in a plan year to use up to $500 in the next plan year, in addition to the regular $2,500 limit during the succeeding year.
The IRS provided guidance on implementation by employers of the $2,500 annual limit on employee salary reduction contributions to health FSAs.
This two-part article provides an overview of current developments in employee benefits, including executive compensation, welfare benefits, and qualified plans. Part I focuses primarily on executive compensation and welfare benefits.