Deadline Extended to Provide ACA Tax Forms to Employees

| posted in Blog, Newsletter

The Internal Revenue Service is presenting employers with a gift by extending the deadline during which they are required to furnish essential Affordable Care Act-related forms to their employees. Applicable large employers (ALEs) to whom the ACA employer mandate applies will now have until March 4, 2019 to furnish their employees with Forms 1095-B and 1095-C for 2018. The old deadline was Jan. 31, 2019. Also, the IRS is extending relief from penalties to employers who file or furnish incorrect or incomplete statements if they can show they made a good-faith effort to comply. ALEs with 50 or more full-time…
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IRS Issues 30,000 ACA Penalty Notices

| posted in Blog, Newsletter

The IRS has been sending penalty notices to more than 30,000 businesses nationwide, advising them that they may be out of compliance with the Affordable Care Act employer mandate. The tax agency said those employers are on the hook for a total of roughly $4.3 billion in fines. While the individual mandate has been repealed starting in 2019, the employer mandate is intact and the IRS is pursuing penalties aggressively. Under the ACA, companies with more than 50 full-time employees are required to extend health insurance to their workers. Failure to do so can result in penalties as high as…
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IRS Announces 2019 HSA Contribution Limits, Changes for HDHPs

| posted in Blog

The IRS has increased health savings account contribution limits for 2019, along with changes to the out-of-pocket expenses for HSA-qualifying high-deductible health plans (HDHPs). The 2019 HSA contribution maximum will be $3,500 for individual coverage, from $3,450 this year. The contribution maximum for family coverage will increase to $7,000 from the current $6,900. Individuals age 55 or older not yet enrolled in Medicare may make a catch-up HSA contribution of up to $1,000 – an amount that remains unchanged from last year’s catch-up limit. This most recent set of limit adjustments fits the pattern of previous years, with the IRS…
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The Taxation of Long-Term Care Insurance

| posted in Blog

THERE ARE significant federal tax benefits in purchasing long-term care insurance, but like everything else in life and business the devil is in the details. Fortunately, the Health Insurance Portability and Accountability Act provides some clarifications. In general, the income from a long-term care insurance policy is non-taxable, and the premiums paid to buy the insurance are tax-deductible. Similar tax advantages exist at the state level, but each state treats the subject differently. The fact that there are tax benefits to purchasing long-term care coverage testifies to the vital social importance of this underutilized insurance product. Tax Treatment of Premiums…
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As IRS Sends out Enforcement Letters, Be Prepared

| posted in Blog

Even though the Trump administration continues taking steps to try to dismantle the Affordable Care Act, the law applies to employers and the IRS is enforcing it by the book. Businesses are increasingly receiving IRS Letter 226J, which states that they may be in violation of the employer mandate, typically by either not offering coverage when they are legally required to do so or not offering “affordable” coverage to their employees. Under the law, employers with 50 or more full-time workers must offer coverage to their employees that covers the 10 essential minimum benefits and which will cost each employee…
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What the New Tax Law Means for Retirees

| posted in Blog

The Tax Cuts and Jobs Act – the sweeping tax reform measure signed into law by President Trump in late December 2017 – is good news for most retirees. The most significant benefit for most is the increase in the standard deduction, which nearly doubles in 2018 and beyond. The new standard deduction goes from $6,350 to $12,000 for individual filers, from $9,350 to $18,000 for heads of households, and from $12,700 to $24,000 for married couples filing jointly. What does this mean for retirees? An analysis by H&R Block, using a fictional single taxpayer with no dependents and a…
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Important Employer Advisory for Applicable Large Employers

| posted in Blog

The IRS is on the move and Applicable Large Employers should take notice.  Remember, the ACA defines an Applicable Large Employer (ALE) as one with 50 or more full time equivalent employees. Those with 100+ full time equivalents have been subject to its Employer Shared Responsibility provisions, also known as “the employer mandate”, since 2015.  Early last month, the IRS announced their intent to begin sending notices (called Letter 226J) to these employers during the last six weeks of 2017, advising them that they owe a payment (“ESRP”) to the IRS based on the information reported to them on Forms…
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With Health Insurance Laws in Flux, Flexible Spending Accounts Can Save Your Workers Money

| posted in Blog

The Internal Revenue Service is reminding eligible employees that now is the time to begin planning to take full advantage of their employer’s health flexible spending arrangement for next year. If you don’t offer a flexible spending account (FSA) for your employees, you should consider starting one as they allow them to use tax-free dollars to pay medical expenses not covered by their health plan, including deductibles, copays and any pharmaceuticals. Now that the year is winding down, even if your employees were using an FSA this year, they must decide again how much they want to set aside pre-tax…
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IRS Sends out ACA Compliance Letters, Employers Have 30 Days to Respond

| posted in Blog

The IRS has started sending out letters to employers who have failed to comply with the Employer Shared Responsibility provisions under the Affordable Care Act for the year 2015. The IRS seems to be moving forward with notifying employers after attempts to repeal and replace the ACA failed in Congress and since there has been no further rule-making, guidance or legislation that rolls back enforcement of the employer mandate. The IRS will send Letter 226J to applicable large employers (ALEs) if it determines that at least one full-time employee received a subsidy in 2015 in a marketplace to purchase qualified…
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After IRS Tweak Be Careful that You’re Complying with Affordability Test

| posted in Blog

Now that the final attempt (this year) at dismantling the Affordable Care Act came to a quiet end in the last week of September, employers need make sure that they stay on track with compliance. First and foremost is that the ACA’s employer mandate and shared responsibility provisions still stand. That includes the affordability test, to which employers need to pay special attention, as increases in premium can put some of your employees over the edge into “unaffordable” coverage territory. And this year there’s a twist that you need to be aware of. As it’s almost time for open enrollment,…
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