The Internal Revenue Service (IRS), Department of the Treasury (DOT), Employee Benefits Security Administration (ESA), and Department of Health and Human Services (DHS) recently issued a final ruling on the use of employer-funded health accounts. Effective January 1, 2020, employers of all sizes that do not offer a group coverage plan may use HRAs as a vehicle to help employees pay for health insurance premiums. This ruling extends beyond the current scope of health reimbursement arrangements (HRAs), which allows businesses to offer employer-funded accounts for employees to apply to out-of-pocket medical expenses and now allows employees to pay for insurance premiums.
The new ruling is expected to affect more than 800,000 employers and 11 million employees, making it a far-reaching update to the current system. Under the guidance, employers may offer two new types of HRAs:
To assist employers, the DOL issued this Individual Coverage HRA Model Notice: https://www.dol.gov/sites/dolgov/files/ebsa/laws-and-regulations/rules-and-regulations/completed-rulemaking/1210-AB87/individual-coverage-model-notice.pdf .
This notice is not exhaustive. If you would like more information on how your business might benefit from an ICHRA, give the professionals in our office a call. We can go over your options and determine if you satisfy the ACA’s affordability and minimum value requirements.
Receive Free financial tips & Tax Alerts!
A business owner’s plate is quite full, if not overflowing, from the day-to-day operations to the background necessities like marketing and financial activities. The reality is it’s difficult to do…
Many businesses in certain industries employ individuals who receive tips as part of their compensation. These businesses include restaurants, hotels, and salons. Tip Definition Tips are optional payments that customers…
An array of tax-related limits that affect businesses are indexed annually, and due to high inflation, many have increased more than usual for 2023. Here are some that may be…