Raymond P. TurnerBlog Posts
California Imposes New Flexible Spending Account Notice Requirement On EmployersBeginning with plan years that end in 2020 California employers maintaining flexible spending accounts, or “FSAs,” will be required by a new amendment to the state’s Labor Code, enacted August 30, 2019, to notify the employee participants of any “deadline to withdraw funds before the end of the plan year.” FSAs are expense reimbursement plans...… Continue ReadingOctober 21, 2019 |
EIGHTH CIRCUIT RULES AGAINST THIRD PARTY ADMINISTRATOR IN CROSS-PLAN OFFSETTING IN GROUP HEALTH PLANSOn January 15, 2019, the federal Eighth Circuit Court of Appeals issued its decision in Peterson v. UnitedHealth Group, Inc., 913 F.3d, 769 (8th Cir. 2019), in which the Court upheld the federal district court’s holding that UnitedHealth Group, Inc. (“United”) was not authorized to reduce (or “offset”) payments to medical providers under ERISA group...… Continue ReadingApril 18, 2019 |
DEDUCTIONS AND W-4S: EARLY 2018 RESPONSES TO TAX REFORMThe Tax Cuts and Jobs Act signed into law on December 22, 2017 is prompting some prudent early tax 2018 actions by both employers and employees related to employee benefits. Many employers are electing to make additional employer qualified plan contributions for the 2017 tax year when the employer’s tax rate may be higher and...… Continue ReadingMarch 12, 2018 |
2018 Tax Reform Series: A Change to Participant Loan RolloversOne welcome qualified plan change under the Tax Cuts and Jobs Act is the extension of the period within which a participant may pay the amount of an “offset” of an outstanding plan loan to another qualifying plan or IRA to accomplish a tax-free rollover of the loan offset amount. The change became effective January...… Continue ReadingJanuary 2, 2018 |
FORFEITURE FREEDOMSome of our employer client sponsors of pre-approved 401(k) plans have contacted us regarding plan amendment notices received recently from their prototype or volume submitter plan document sponsors relating to the expanded use of forfeitures in their plans. An employer is informed either that an amendment has already been made for all employers that have...… Continue ReadingAugust 16, 2017 |
DETERMINATION LETTER RATIONING: IRS REVEALS THE BRAVE NEW WORLDLast year’s announcement by the Internal Revenue Service (IRS) of the elimination of the current five-year remedial amendment cycle system for determination letter approval of restated individually-designed qualified plan documents provoked bitter criticism and calls to reverse course. The Service cited budget constraints allowing a median time of only three hours of agent review per … Continue ReadingJuly 10, 2016 |
DEATH AND TAXES FOR QUALIFIED PLANSAn IRS plan audit uniquely focuses an employer’s mind on the core identity of its qualified retirement plan, which is that of a tax exempt organization, but one whose exemption (or “qualification”) requirements are far pickier than those applicable to one’s favorite charity. Any single material operational violation or non-conforming written plan provision risks disqualification … Continue ReadingMarch 14, 2016 |
THE RETROACTIVE AMENDMENT FIX FOR PLAN OPERATIONAL FAILURESFrequently a plan sponsor’s operational failure to follow the terms of its 401(k) or other qualified plan can be corrected under the IRS’s Employee Plans Compliance Resolution System (“EPCRS”) (described at http://www.irs.gov/Retirement-Plans/EPCRS-Overview) with a retroactive amendment instead of a sometimes expensive financial correction. This possibility should not be surprising, given that the maintenance of qualified... Continue ReadingJuly 14, 2015 |