Headlines about "Cafeteria plans (125, flexible spending)"

Gathered from the web by the editors at BenefitsLink.com.
[Guidance Overview] Heroes Earning Assistance and Relief Tax Act Adds Benefits for Those in Military Service (PDF)
Pages 3- of 8 pages. Excerpt: "The HEART Act deals principally with the tax treatment of military personnel, with provisions applying to a wide range of Internal Revenue Code ('Code') provisions. This article will deal primarily with those provisions which have an effect on qualified retirement or Section 125 plans, and IRAs." (Trucker Huss)

[Official Guidance] Text of Final IRS Regs: Dependent Child of Divorced or Separated Parents or Parents Who Live Apart (PDF)
26 pages. Excerpt: "This document contains final regulations relating to a claim that a child is a dependent by parents who are divorced, legally separated under a decree of separate maintenance, or separated under a written separation agreement, or who live apart at all times during the last 6 months of the calendar year. The regulations reflect amendments under the Working Families Tax Relief Act of 2004 (WFTRA) and the Gulf Opportunity Zone Act of 2005. . . . These regulations are effective July 2, 2008." (Internal Revenue Service)

[Guidance Overview] Bush Signs Military Reservist Benefits Measure
Excerpt: "Employees no longer will have to forfeit unused balances in their health care flexible spending accounts when called up from the reserves for active military duty." (Workforce Management; free registration required)

[Guidance Overview] Miller & Chevalier's Focus on Employee Benefits, June 5, 2008 (PDF)
6 pages. The newsletter offers articles on: Health FSA and Mental Health Parity; Qualified Plan Queries: Differential Pay Now Compensation Under Code Section 415 and New Distribution Feature; Qualified Plan Queries: Military Survivor and Disability Benefits Under Tax-Qualified Plans; Exec Comp Corner: New Code Section 887A Impacting Withholding on Certain Expatriates' Deferred Compensation. (Miller & Chevalier Chartered)

New Legislation Enhances 401(k) Benefits for Military Personnel, Allows Qualified Reservist Distributions from Health FSAs, and Extends MHPA
Excerpt: "For some 401(k) plans, the Act's rule requiring enhanced survivor benefits may trigger accelerated vesting of matching and profit-sharing contributions for short-service participants. While not previously mandatory, treating differential military pay as plan compensation was already available for 401(k) plans in the final regulations under Code Section 415. (And while not specifically addressed, the Act may also facilitate pre-tax cafeteria plan salary reductions from differential pay.)" (Employee Benefits Institute of America)

House Approves FSA Funds for Reservists Called to Duty
Excerpt: "Legislation approved Tuesday, May 20, by the House of Representatives would allow individuals called up from the reserves for active military service for at least six months to take unused balances in their health care flexible spending accounts as a taxable distribution." (Workforce Management; free registration required)

[Guidance Overview] Chart for Corporate Employers That Compares FSAs, HRAs and HSAs (PDF)
2 pages. (The Segal Group, Inc.)

[Guidance Overview] Final HSA Comparability Guidance Clarifies Fair Worker Benefits
Excerpt: "A long-awaited final guidance on employer comparable contributions to health savings accounts (HSAs) was released April 17 by the Treasury Dept. and IRS. The guidance clarifies the obligations to other employees when some are offered an HSA as part of their benefits." (AISHealth.com)

[Guidance Overview] Hot HR Compliance Issues for Small Businesses in 2008
Excerpt: "The purpose of this article is to highlight a few issues before they become critical [such as Section 409A, flex plans, qualified retirement plans, and 401(k) contributions]." (Employee Benefit News; free registration required)

[Guidance Overview] Flexible Spending Account Administrator Breached ERISA by Applying IRC § 125 Requirements
Excerpt: "In a decision that underscores the importance of complying with ERISA's Title I requirements, the U.S. District Court of New Jersey held that the administrator of a Flexible Spending Account violated ERISA by applying the IRC § 125 definition of when a medical expense is 'incurred' when the relevant plan documents were silent on the issue. O'Meara v. _________, Civil Action No. 07-CV-4429 DMC (April 1, 2008)." (Deloitte via BenefitsLink.com)

[Guidance Overview] Employer Breached ERISA Fiduciary Duties by Providing Misleading Health FSA Documents
Excerpt: "EBIA Comment: IRS regulations prohibit health FSAs from reimbursing medical expenses before they are 'incurred,' and provide that medical expenses generally are 'incurred' when medical care is provided, not when the employee is formally billed, charged for, or pays for the medical care. This is not the first time that an employer has run into problems by providing health FSA disclosure documents that refer to IRS Publication 502, which is used to help taxpayers determine what medical expenses they can deduct on their tax returns but is not intended to help someone decide what expenses are reimbursable under a health FSA . . . ." (Employee Benefits Institute of America)

[Guidance Overview] Proposed Regulation on TRICARE Incentive Prohibition Addresses Treatment of Cafeteria Plans
Excerpt: "EBIA Comment: The TRICARE incentive prohibition applies beginning January 1, 2008 to all employers (except those with fewer than 20 employees). The DoD had previously indicated that the TRICARE incentive prohibition regulation would not consider a Code Section 125 cafeteria plan to be an unlawful incentive so long as all plan participants are treated the same . . . . Although the regulation is only proposed at this point, employers that are subject to the prohibition may want to familiarize themselves with the regulation and its preamble. The prohibition against offering financial or other incentives must be taken seriously -- civil penalties of up to $5,000 can be imposed for each violation." (Employee Benefits Institute of America)

FSA's Diversion from IRS Definition Misleading to Participants
Excerpt: "A Flexible Spending Account (FSA) plan sponsor had a fiduciary duty to plan participants to clearly state in plan documents that its definition of the word 'incur' was different from the Internal Revenue Service definition, the U.S. District Court for the District of New Jersey ruled." (PLANSPONSOR.com; free registration required)

[Guidance Overview] Are Rollover and Transfer Contributions to Health Savings Accounts Permitted?
Excerpt: "Rollover and transfer contributions from Archer Medical Savings Accounts (MSAs) and other HSAs to an HSA are permitted. They need not be in cash and are not subject to the annual contribution limits. . . . Rollovers from certain flexible spending arrangements (FSAs) and health reimbursement arrangements (HRAs) are also allowed, subject to the rules of IRS Notice 2007-22." (Wolters Kluwer)

Controlling Health Insurance Premiums with FSA, HRA, HSA Plans
Excerpt: "Health insurance costs are rising much faster than inflation. But what can manufacturers do about it? One idea that seems to be working is giving employees 'ownership' in their health plans. A big problem is that employees are disconnected from the cost of healthcare. For instance, when asked in surveys, a surprising number of people think the doctor only receives their health plan's co-pay amount, $10 or $20!" (Penton Media, Inc.)

[Guidance Overview] Tax-Free Long-Term Disability Benefits (PDF)
Pages 2-3 of 4 pages. Excerpt: "An employer who wishes to provide its employees with the opportunity to make after-tax contributions and receive their disability benefits on a tax-free basis needs to prospectively amend its cafeteria plan to permit payment of the premiums on an after-tax basis and communicate this option to employees." (Miller & Chevalier Chartered)

[Guidance Overview] State Law Requiring Consent Prior to Withholding for Benefits Preempted
Excerpt: "ERISA preempts a state law requiring employees' written consent prior to withholding wages for welfare benefits, according to an Employee Benefits Security Administration (EBSA) advisory opinion." (Wolters Kluwer Financial Services)

[Official Guidance] Text of Proposed Labor Regs: 7-Day Safe Harbor for Participant Contributions for Plans Having Fewer Than 100 Participants (PDF)
Excerpt: "[T]he Department believes that adoption of a '7-business day' safe harbor rule would present little, if any, additional risk to plan participants and beneficiaries. In this regard, the Department believes that most employers with small plans that are taking longer than 7 business days to deposit participant contributions will expedite the depositing of those contributions to take advantage of the safe harbor. The Department also believes that where participant contributions are being made by employers with small plans within a period shorter than 7 business days, few employers with small plans will incur the costs attendant to modifying their payroll system in order to hold such contributions for a few additional days." (Employee Benefits Security Administration, U.S. Department of Labor)

[Opinion] DOL 'Preempts' Congress on Auto-Enrollment
Excerpt: "The Department of Labor last week posted on its website Advisory Opinion 2008-02A expressing its opinion that, at least when it comes to ERISA preemption, Congress is…well…kind of irrelevant. The advisory opinion is in response . . . to Solicitor of Labor Eugene Scalia's questions on behalf of Sprint-Nextel's automatic enrollment cafeteria plan, which automatically defaults non-electing employees into a health plan. Importantly, the default plan requires employee cost sharing in the form of payroll deductions." (Baker & Daniels LLP)

[Guidance Overview] ERISA Preempts State Law Requiring Employers to Obtain Employees' Written Consent Before Withholding for Health Plan Benefits
Excerpt: "EBIA Comment: This isn't the first time the DOL has issued an advisory opinion finding a state wage withholding law to be preempted by ERISA. But it is important to remember that an advisory opinion may be relied upon only by the parties identified in the request and that state wage withholding laws come in various forms." (Employee Benefits Institute of America)

[Guidance Overview] DOL Opines on ERISA Preemption After the Pension Protection Act (PDF)
2 pages. Excerpt: "In Advisory Opinion 2008-02A . . ., the Department of Labor issued its first advisory opinion addressing the scope of ERISA's preemption provisions since the enactment of the Pension Protection Act in 2006." (Sutherland Asbill & Brennan LLP)

[Guidance Overview] IRS Issues 2008 Version of Taxable Fringe Benefit Guide
Excerpt: "This publication offers helpful insight into the IRS's positions regarding the taxation, withholding, and reporting requirements for certain employee fringe benefits. However, employers and administrators looking for an IRS publication on the tax treatment of a broader variety of fringe benefits (including cafeteria plans, adoption assistance, and HSAs) may wish to consult IRS Publication 15-B . . . ." (Employee Benefits Institute of America (EBIA))

[Guidance Overview] Can I Have an HSA If I Have a Health FSA or HRA?
Excerpt: "Participation in a health flexible spending arrangement (FSA) or health reimbursement arrangement (HRA) may negatively affect an individual's HSA eligibility. Even with HDHP coverage, an individual also covered by a health FSA or an HRA that pays or reimburses qualified medical expenses prior to meeting the HDHP deductible generally cannot make regular HSA contributions. An individual's participation in one of these plans may also disqualify his/her spouse from an HSA." (Wolters Kluwer Financial Services)

Health and Welfare Update: What Plan Sponsors Should Be Doing Now (PDF)
52 pages. (Morgan, Lewis & Bockius LLP)

Ten Considerations for Section 125 Plans (PDF)
6 pages. Excerpt: "In August 2007, the Internal Revenue Service effectively replaced the majority of existing Section 125 plans regulations, supplanting them with a new set that will take effect for plan years beginning on or after Jan. 1, 2009. See these ten points to make sure that your cafeteria plan is ready." (Milliman)

One-Cent Decrease in 2008 Mileage Rate for Transportation to Obtain Medical Care or as Part of Deductible Moving Expenses
Excerpt: "[T]he standard mileage rate for use of an automobile to obtain medical care (which may be deductible under Code Section 213 if it is primarily for, and essential to, medical care) will be 19 cents per mile for 2008 -- a one-cent decrease from 2007. The same decreased rate also will apply for use of an automobile as part of a move for which the expenses are deductible under Code Section 217." (Employee Benefits Institute of America (EBIA))

Cafeteria Plan Rules Hold Risks, Opportunities, Benefits Attorney Says
On the target page, click on the link under the heading 'Attachments." (Miller Chevalier)

Sec. 125 All-Or-Nothing Penalties Criticized
Excerpt: "The all-or-nothing penalties in the proposed Sec. 125 regulations are overly burdensome, according to several speakers at a November 15 IRS hearing on the regulations. 'Any slip up will cause a plan to be disqualified,' John Hickman, partner at Employers Council of Flexible Compensation said . . . ." (CCH Benefits)

Text of Aon's 2007 Year-End Checkup for Benefit Plans (PDF)
15 pages. Excerpt: "This Alert will help identify general year-end administrative and planning issues that could lead to compliance or employee relations problems if not addressed before, or early in, 2008. In addition, we have highlighted recent legislative or regulatory developments that may require plan design or documentation changes, particularly in response to the Pension Protection Act of 2006 (PPA), final Internal Revenue Code (IRC) §409A regulations, and the re-proposed IRC §125 regulations." (Aon)

Overview of Buck's Submitted Comments on Proposed Regs Under Section 125 of the Internal Revenue Code (PDF)
2 pages. Excerpt: "Given the complexity of the nondiscrimination provisions of the new proposed regulations, we urged the IRS to consider the following actions – Define the term 'highly compensated individual' in the same way as for pension, dependent care and adoption assistance purposes. Provide clear examples regarding performance of the eligibility test and the logic behind the result. Provide further guidance on the valuation of qualified benefits. The value should be the total nontaxable value of the coverage and should include both employer costs and employee salary reduction contributions. Replace the concept of 'uniform' coverage with 'nondiscriminatory' coverage to enable employers to provide less expensive health coverage to lower paid employees. Allow plans to be freely disaggregated for testing purposes. Permit snapshot date testing for eligibility and benefits. Provide a voluntary correction mechanism for violations." (Buck Consultants)

Council Comments to IRS on Proposed Section 125 Cafeteria Plan Regulations (PDF)
14 pages. Excerpt: "Although many of the rules in the proposed cafeteria plan regulations are helpful clarifications, employers and service providers are concerned about several aspects of the rules, including the IRS' position that any mistake in the plan document, or any mistake in administering the plan, will result in adverse tax consequences that impact all cafeteria plan participants." (American Benefits Council)

From the Employers Council on Flexible Compensation: Text of Extensive Comments on Proposed Cafeteria Plan Regs (PDF)
37 pages; filed November 5, 2007. Very well-written: clear, precise; includes explanation of issues and a detailed suggested revision for each issue. (Employers Council on Flexible Compensation)

Items of Interest for Health Plans in the New IRS Cafeteria Plan Proposed Regulations (PDF)
7 pages. Excerpt: "The [paper presents] highlights from the rules that are likely to be of interest to health plans, particularly those that provide cafeteria plan administrative services." (Miller & Chevalier Chartered)

Cafeteria Plan Rules Hold Risks, Opportunities, Benefits Attorney Says (PDF)
Excerpt: "Employers should be very careful in adopting the rules because the Internal Revenue Service is taking a ''zero tolerance compliance standard,'' . . . . Plans must precisely follow all the rules in the terms of plan design, written plan documents, and operations . . . . The rules, proposed in August, are a ''significant rulemaking,'' in which IRS consolidated and updated previous cafeteria plan guidance dating to 1984 . . . ." (The Bureau of National Affairs, Inc. via Miller & Chevalier Chartered)

Employee Benefits Developments November 2007
Rulings, opinions, cases. (Hodgson Russ LLP)

Frequently Asked Questions about Flexible Spending Accounts
Answers to common questions about FSAs. (Ceridian Corporation)

Health Insurance Terms Key to Choices at Work
Excerpt: "When it comes to your health insurance, can you define a flexible spending account, a health reimbursement account or a Health Savings Account? If you can't, you're not alone." (The Dallas Morning News; free registration required)

Pay the Doctor Bill, Not the Tax Bill, with Flexible Spending Accounts
Excerpt: "[Even though flexible spending accounts] are widely offered, few of us sign up. One study showed that more than 96 percent of large companies offered FSAs, but only one-quarter of employees participated in the healthcare accounts and just 3 percent used the dependent-care accounts." (Star-Telegram.com; free registration required)

The links shown above have been gathered from the web by the editors at BenefitsLink.com. Each article's publisher is shown above in parentheses. Opinions expressed in each article are those of the article's publisher, not necessarily those of BenefitsLink.com, Inc. or any web site that displays these headlines in a "frame." You should contact the listed publisher for copyright information about any particular article or to inquire into the right to use the article in any manner.