Illinois passed the Consumer Coverage Disclosure Act (CCDA) in 2021. In a nutshell, the CCDA requires all employers to send employees a notice comparing their health benefits to a list of the state of Illinois’ Essential Health Benefits (EHBs). Depending on the size of the employer and how the law is interpreted, the civil penalties for non-compliance could run anywhere from a nuisance fee to astronomically high.
There are both single-employer pension plans and multiple employer plans (MEPs). In a single-employer plan, only employees within the same “controlled group” of businesses are allowed to participate. Put very simply (because the rules are complicated), the controlled group consists of different entities that share enough common ownership that they are treated as a single employer for employee benefits purposes. And all of those employers’ employees are able to participate in one plan.
At the beginning of this year, we wrote about changing standards applicable to audits of financial statements of employee benefit plans subject to ERISA. Specifically, we explained that the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA) issued new standards for what are currently known as “limited-scope audits.” Initially, the changed audit standards were effective for plan years ending on or after December 15, 2020, but due to the COVID-19 pandemic the AICPA delayed the implementation of the standards to audits of plan years ending on or after December 15, 2021. We want to remind plan sponsors of employee benefit plans required to include an auditor’s report as part an annual Form 5500 filing that the changed audit standards create new responsibilities for plan sponsors in 2022.
In 2018, the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA) changed the audit standards applicable to audits of financial statements of employee benefit plans subject to ERISA. These standards impact what is currently known as “limited-scope audits.” Initially, the new standards were to apply to audits of plan years ending on or after December 15, 2020, which means they would apply to 2020 plan year audits performed in 2021. However, due to the COVID-19 pandemic, the AICPA changed the effective date of the standards to plan years ending after December 15, 2021, extending the implementation of the standards for one year. Plan sponsors of plans subject to ERISA should be aware of the new responsibilities the standards impose on auditors, as these changes also indirectly create new responsibilities for plan sponsors.
On March 27, 2020, President Trump signed the Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act. The CARES Act includes the following provisions that impact retirement plans and provide relief to plan sponsors and plan participants.
- Participants may take “coronavirus-related distributions” from qualified retirement plans.
- A coronavirus-related distribution is exempt from the 10 percent penalty that otherwise applies to early distributions from qualified retirement plans.
The Tax Cuts and Jobs Act (TCJA) eliminated a host of miscellaneous itemized deductions through 2025, including a deduction for job-related education expenses pursuant to Code Section 162. Simple enough.
Except that many employer-provided education benefits are directly tied to the employee’s right to claim a deduction under Section 162. These include tax-free employer payments and reimbursements for college courses and continuing education, as well as an employer’s in-kind provision of such education. If no individual deduction is available for such expenses under Section 162, can the employer still provide, pay for, or reimburse employees for education without it being taxable to the employee?
In Executive Order 13813, President Donald Trump made it the official policy of the executive branch to find ways to expand the use of Association Health Plans (AHPs) as a means of providing quality, affordable coverage across state lines.
On January 4, 2018, the U.S. Department of Labor issued a proposed rule designed to do just that. Based on 2015 figures, the proposed rule has the potential to impact the health coverage of about 44 million people, whether by expanding coverage to the uninsured, by making more affordable coverage available to sole proprietors and small employers, or by cutting back some individuals’ benefits.
The federal agencies charged with administering the Affordable Care Act released interim final regulations Oct. 6, 2017, that extended the exemption from providing contraceptive coverage to more employers and individuals effective immediately. Days later, the government settled dozens of lawsuits filed by organizations challenging the so-called “contraceptive mandate.” But several new cases challenging the expanded exemption were filed.
Thanks to the 21st Century Cures Act, beginning Jan. 1, 2017, some employers can now offer employees a new type of health reimbursement arrangement, called a Qualified Small Employer HRA. Primarily governed by 26 U.S.C. § 9831(d), these HRAs are designed to help subsidize employees’ purchase of health coverage on the exchange, although they can also be used to help pay for other medical expenses.
The following questions and answers explain how these new HRAs work.
The U.S. Department of Labor recently issued a proposed prohibited transaction exemption allowing privately held conglomerate ABARTA to contribute real property to its defined benefit plan and simultaneously lease back the property.