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The President’s Benefits Budget Proposals

March 2, 2016

Authors

Chris Rylands

The President’s Benefits Budget Proposals

March 2, 2016

by: Chris Rylands

ThinkstockPhotos-122516159A few weeks ago, the President released his proposed budget for the fiscal year 2017. As usual, it is dense. However, the President has suggested some changes to employee benefits that are worth noting. While they are unlikely to get too much traction in an election year, it is useful to keep them in mind as various bills wind their way through Congress to see what the President might support.

  • Auto-IRAs. Stop us if you’ve heard this one before. The proposal would require every employer with more than 10 employees that does not offer a retirement plan to automatically enroll workers in an IRA. No employer contribution would be required and, of course, individuals could choose not to contribute. (In case you’ve forgotten, we’ve seen this before.)
  • Tax Credits for Retirement Plans. Employers
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Congress Engages in Some Holiday Spending on Benefits

January 6, 2016

Authors

Brian Berglund

Congress Engages in Some Holiday Spending on Benefits

January 6, 2016

by: Brian Berglund

Congress’s recent $1.8 trillion holiday shopping spree (aka The Consolidated Appropriations Act, 2016, which became law on December 18, 2015) included a few employee benefit packages. We recently unwrapped the packages. Here is what we found.

ThinkstockPhotos-86538940

1.   Cadillac Tax Delayed. The largest present under the employee benefits tree is a delay in the so-called “Cadillac” tax, which as originally enacted imposed a 40% nondeductible excise tax on insurers and self-funded health plans with respect to the cost of employer-sponsored health benefits exceeding statutory limits. The tax is now scheduled to take effect in 2020 rather than 2018. Once – or if – the delayed tax provision becomes effective, it will be deductible. The cost of this gift is $17.7 billion.

Since the Cadillac tax is basically unadministrable in its current form, we can’t imagine there is even one person at Treasury

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Cadillac Tax Still on the Assembly Line

August 18, 2015

Authors

Chris Rylands

Cadillac Tax Still on the Assembly Line

August 18, 2015

by: Chris Rylands

Assembly LineRecently, the IRS issued Notice 2015-52 requesting additional input on the yet-to-be-proposed Cadillac Tax rules.  For those unaware, the Cadillac Tax imposes a 40%, non-deductible excise tax on the cost of health coverage that is over a certain threshold.  This deceptively simple description does not begin to uncover the myriad of potential issues, such as…

Who pays the tax?

Well, the “coverage provider” pays the tax.  For insured plans, that’s easy: it’s the insurer.  For HSAs or Archer MSAs, it’s the employer.  But what about a self-funded plan?  The statute says it’s the “person that administers the plan benefits.”  That phrase is undefined in the statute or really anywhere else.

The IRS is looking at two possible approaches for defining this term.  One is to look at a self-funded plan’s third party

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The Fiscal Cliff, The Taxation of Health Insurance, and The Retirement Crisis

November 13, 2012

Authors

Chris Rylands

The Fiscal Cliff, The Taxation of Health Insurance, and The Retirement Crisis

November 13, 2012

by: Chris Rylands

Now that the election dust has settled, much of the news is about the looming fiscal cliff (as discussed on our sister blog, TrustBryanCave.com). As most of us recall, this is not a new issue, but one that our elected leaders have created for us. (This Forbes op-ed has a pretty good explanation, including mentioning the tax increases we’ve blogged about previously.)

In 2010, the National Commission on Fiscal Responsibility (commonly known as the Simpson-Bowles Commission) issued its report on how to solve the fiscal crisis. Among the features of its comprehensive plan were 2 benefits related items. Given that a combination of a lame duck Congress and a second term President are likely to address the fiscal cliff in some fashion, it is worth revisiting the report and

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