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Employee Benefits
U.S. Department of Labor Issues Cybersecurity Guidance for Retirement Plans
Cybersecurity threats are becoming ubiquitous in today’s technology-driven, cloud-based society and even more so now as the COVID-19 pandemic has fundamentally changed the way people work, communicate, and save. No information is safe and no financial assets, including your 401(k) plan, are…
DOL Issues Temporary Safe Harbor for Missing Participants in Terminating Defined Contributions Plans
In 2017, the Pension Benefit Guaranty Corporation (“PBGC”) established the PBGC Defined Contribution Missing Participants Program (the “Program”) for terminated defined contribution plans (e.g., 401(k), profit sharing and stock ownership plans). The Program was established to hold retirement…
American Rescue Plan Act Welfare Plan Issues
COBRA Continuation Coverage
The American Rescue Plan Act (“ARPA”) impacts employers sponsoring certain group health plans in multiple ways, but the primary impact is to: (1) provide a six-month premium subsidy for selected COBRA qualified beneficiaries and (2) create special enrollment rights for…
Is It Time to Amend Your Plan Documents for Class Action Waiver and/or Mandatory Arbitration Clauses?
Is it time you consider amending your plan document to provide a waiver of class actions and mandatory arbitration? We first visited this issue one year ago after a 2019 federal court decision approved use of class action waiver and mandatory arbitration provisions as a means to reduce potential…
IRS Announces Retirement Plan Limitations for 2021
On October 26, 2020, the Internal Revenue Service issued Notice 2020-79 to announce the cost-of-living adjustments applicable to pension and retirement plan dollar limitations for the 2021 tax year – most of which will remain unchanged from 2020. Additionally, the Social Security Administration has…
DOL Finalizes Rule Providing Alternative Safe Harbor Method for Electronic Disclosure by ERISA Retirement Plans
On May 21, 2020, the Department of Labor (DOL) published its final rule establishing an alternative safe harbor method of delivery of electronic disclosures by retirement plan administrators. The Alternative Safe Harbor allows employers to post retirement plan disclosures online or deliver them to…
COVID-19 and ESOP Distribution Policies: Dealing with Down Times in an ESOP Company
When preparing this Alert, I recalled a presentation I did in 2008 called “Dealing with Down Times in an ESOP Company.” Well, here we are 12 years later, but the impact of the COVID-19 pandemic on many ESOP companies is even worse than the 2008 recession.
In addition to the difficult issues faced by…
IRS Guidance Increases FSA Carryover Limit, Clarifies Reimbursement of Individual Health Coverage Premiums
Overview
On May 12, 2020, the IRS issued Notice 2020-33, which (i) increases the carryover limit for flexible spending arrangements (“FSAs”) to $550, and (ii) clarifies the timing for reimbursement of individual health coverage premiums under certain tax-favored arrangements. This guidance was…
IRS Provides Flexibility for Cafeteria Plans to Permit Mid-Year Election Changes, Extend FSA and DCAP Claims Periods
Overview
On May 12, 2020, the IRS issued guidance in response to the COVID-19 pandemic which provides flexibility during calendar year 2020 for employer-sponsored health coverage, health flexible spending arrangements (“FSAs”), and dependent care assistance programs (“DCAPs”). IRS Notice 2020-29…
DOL and IRS Pandemic Relief for Group Health Plans and Retirement Plans
Overview
On April 29, 2020, the U.S. DOL, Treasury Department and the IRS issued deadline relief and other guidance to aid employee benefit plans and plan participants impacted by the COVID-19 pandemic. The guidance extends certain timeframes affecting participants’ rights to healthcare coverage,…
Employer Tax-Free, Deductible Disaster Relief Benefits for Employees
An employer seeking to provide additional financial support to employees during the COVID-19 pandemic may want to consider a “qualified disaster relief payment” program. Qualifying disaster relief payments are not only tax-free to employees in most cases, but are also fully tax-deductible to the…