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Compliance Questions – Cash Out Option

Provided by Larry GrudzienQ. Each year, my client gives its employees a choice of health coverage or a cash payment of $3,000. If my client does not adopt a cafeteria plan, will any portion of the health coverage elected by the employee be taxable? A. Yes. An employee will be taxed up to the amount...
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Compliance Questions – Cash Out Option

Provided by Larry GrudzienQ. Each year, my client gives its employees a choice of health coverage or a cash payment of $3,000. If my client does not adopt a cafeteria plan, will any portion of the health coverage elected by the employee be taxable? A. Yes. An employee will be taxed up to the amount...
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Compliance Questions – Cash Out Option

Provided by Larry GrudzienQ. Each year, my client gives its employees a choice of health coverage or a cash payment of $3,000. If my client does not adopt a cafeteria plan, will any portion of the health coverage elected by the employee be taxable? A. Yes. An employee will be taxed up to the amount...
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Court Approves Non-Traditional Work Week for Overtime Pay

Federal overtime pay standards under the Fair Labor Standards Act (FLSA) are strict, but that doesn't mean employers can't be flexible in scheduling workdays, even if it trims overtime wages.In a recent case, the Fifth Circuit Court of Appeals affirmed a lower court ruling in determining that a Texas-based environmental solutions firm did not violate...
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Failure to Recognize FMLA: A Common Employer Mistake

A common misconception among HR managers of small-to-midsize employers is the assumption that they only have a "few Family Medical Leave (FMLA) events occur per year." Failure to recognize FMLA is a growing concern among companies ranging in size from 50 to 250 employees. The complexities of administering FMLA, along with the ever-changing regulations and...
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What’s the Outlook for the Expired Tax Breaks?

Year end tax planning for 2014 is particularly challenging because Congress has yet to act on a host of tax breaks that expired at the end of 2013. It is uncertain at this time whether the expired provisions will be extended by Congress on a permanent or temporary basis -- and whether any such extension...
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Healthcare Reform Questions: 50-99 employee transitional relief

Question:  One of my clients has 75 employees and has never offered health coverage to its employees and it does not plan do so in the future.  When would it have to comply with the employer mandate, 2015 or 2016?Answer:  January 1, 2016  For employers eligible for the transition relief described below, no subsection (a) or...
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IRS Clarifies Its Position on Contributing to Employee Health Coverage

Last year, the IRS spelled out how it would treat employer contributions to employees to help them buy coverage on their own. More recently, it reiterated its position in Q&A format. The question the IRS posed to itself:What are the consequences to the employer if the employer does not establish a health insurance plan for...
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IRS Increases ACA’s Affordability Percentages for 2015

On July 24, 2014, the IRS released Revenue Procedure 2014-37 to index the Affordable Care Act's (ACA) affordability percentages for 2015 under the employer mandate. The IRS also adjusted upward the income level under which employees are exempt from the ACA's individual mandate.Employer Mandate Adjustmentapplicable large employer's health coverage will be considered affordable for plan...
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IRS Issues Final Regulations on Small Business Health Credit

Although many payroll and other employment provisions of the Affordable Care Act (ACA) are only just taking effect -- or will go into effect soon -- at least one significant element of the law has been kicking around for several years, but not without some difficulty.Under the ACA, a qualified small business can claim a...
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Supreme Court Weighs in on ESOPs

Employee stock option plans (ESOPs) were conceived to be a "win-win" for businesses, under the right circumstances. The premise is, when employees have an equity stake in the company they work for, their interests will be aligned with owners because they actually become owners themselves.Congress established tax benefits for ESOPS to help business owners overcome...
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FMLA Enforcement Initiative: Are you ready?

The Department of Labor is extremely busy in launching on-site FMLA compliance investigations this year. As reports of more 2014 DOL audits surface, employers grow more afraid of failing an investigation for non-compliant FMLA policy and procedures, as well as providing insufficient paperwork including notices, certifications and records.A recent headline in the news pointed out...
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Are employee assistance programs subject to COBRA?

Provided by Larry GrudzienAre employee assistance programs subject to COBRA?An employee assistance program  ("EAP" ) can include any of a variety of employer-sponsored programs that seek to prevent or mitigate personal or family problems that could adversely affect an employee's productivity.  For most EAPs , a third-party vendor is involved, with certain benefits (usually counseling)...
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The Heartbleed Bug: Is your information protected?

One of the largest internet security threats in history is breaching and compromising many of the websites you use every day. The Heartbleed Bug affects websites using an OpenSSL format, allowing the potential for anyone to access and read any encrypted data sent between your computer and a server. This encryption flaw allows for disclosure...
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IRS Releases Q&As on Reimbursing Individual Health Premiums

On May 13, 2014,  the IRS issued Q&A guidance restating the conclusion in Notice 2013-54, that an employer is considered to establish a type of group health plan-called an “employer payment plan”-if it reimburses employees’ premiums for individual health insurance policies.In Notice 2013-54, the IRS states that because employer payment plans cannot integrate with individual insurance policies, they will...
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Pre-tax individual healthcare premiums

Question:  Can an employer reimburse its employees for premiums on a pre-tax basis for purchasing individual market medical coverageAnswer: No. In IRS Notice 2013-54  & Technical Release 2013-3, the IRS and DOL prohibit the reimbursement of premiums for individual medical policies from health reimbursement arrangements and premium only plans.The IRS and DOL indicate that such arrangements that help...
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Is Severe Obesity Protected by the ADA? Some Courts Say ‘Yes’

Last month, a U.S. District Court rejected an employer’s petition to dismiss a case brought by Joseph Whittaker, a severely obese employee, who had been terminated. Whittaker had worked seven years for the company before his termination. The employer maintained the employee was unable to perform his job due to his limited mobility. (Joseph Whittaker...
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Don’t Become the Latest DOL Press Release: On-Site FMLA Investigations

The new Department of Labor FMLA Branch Chief is calling 2014 a “pivotal” year for FMLA enforcement through a renewed focus on conducting compliance investigations with an emphasis in on-site FMLA visits. Going forward, the DOL has the authority to come on-site whenever it deems appropriate. The DOL states that the standard request for information will...
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Special 60-Day Enrollment Period in the Marketplace for COBRA Participants

Important Notice Regarding COBRA Continuation Coverage and Health Insurance MarketplaceOn May 1, 2014 The Department of Health and Human Services (HHS) announced a special 60-Day Marketplace enrollment period for individuals eligible and/or enrolled in COBRA as of May 2, 2014.  These individuals have until July 1, 2014 to select Qualified Health Plans (QHPs) in the...
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If someone voluntarily disenrolls in COBRA during open enrollment, are they eligible for subsidies in the Individual Marketplace?

During Marketplace open enrollment, a person can voluntarily drop their COBRA coverage and get a Marketplace plan instead, even if their COBRA hasn’t expired. They also may be determined eligible for credits and subsidies in this case.Outside of Marketplace open enrollment, if a person’s COBRA expires, they would qualify for a special enrollment period and...
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Maintain Compliance and Save Time with BASIC COBRA

Let our COBRA experts help you avoid costly compliance pitfalls. Can you afford to leave your business vulnerable to penalties up to $100 per day per qualified beneficiary?Why should your company choose BASIC COBRA?With a proven administration model and industry certified experts to ensure your company’s ongoing compliance, we handle all the regulation timelines from...
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Employers: Are You Ready for Expansion of Overtime Requirements?

On March 13, President Obama directed the U.S. Department of Labor (DOL) to come up with a way to update overtime pay rules to reflect the “changing nature of the American workplace” and to make them more “in keeping with the intention of the Fair Labor Standards Act.“The move has the potential to affect millions...
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Federal Workers Must Repay Jobless Benefits from Shutdown

The U.S. Department of Labor says federal workers who collected unemployment insurance during the 16-day government shutdown must  return the money because workers will receive back pay.Of the 400,000 federal employees furloughed during the shutdown, about 70,000 applied for jobless benefits with a smaller number actually taking the steps required to receive them.Continue...
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Roll over up to $500 of unused FSA funds

Last week, the Department of Treasury issued Notice 2013.71 that modifies the FSA “use-it-or-lose-it” provision to allow a limited rollover of FSA funds.  This is GREAT NEWS for participants and employers who sponsor an FSA plan, and a positive improvement to a rule that has been opposed for many years. The highlights: 
  • Effective immediately, employers...
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Per-Employee Health Benefit Costs up Slightly in 2014

Employers expect health benefit costs per employee will rise by 4.8% on average in 2014, based on early responses from an annual survey conducted by Mercer. Cost growth slowed to 4.1% in 2012, a 15-year low. The projected increase for 2014, while still relatively low, represents a slight uptick in the rate of growth.Employer strategies...
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How Healthcare Reform is Easing Cancer Patients’ Minds

Every October marks Breast Cancer Awareness Month – an annual campaign raising awareness of the disease and celebrating the 2.8 million breast cancer survivors in the United States.This year, however, October also marked the opening of the health insurance marketplaces in each state which enables people with breast cancer and other forms of cancer to...
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10 Tips for Communicating the ACA to Employees

Information concerning the Affordable Care Act (ACA) is piling up in your employees’ inbox and dominating their news feeds. Undoubtedly they are seeking your expertise to answer questions and clarify any lingering confusion.Below are 10 tips for communication with your employees on the ACA:1. Explain ACA simply and concisely. The law and its regulatory guidance...
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