reimbursing premiums for individual health coverage with employer contributions if the employer is not participating in a Small Business Health Options Program (SHOP) Marketplace plan;
Implementation Schedule 2010 Small business tax credit Adoption credit increase Adoption-assistance program increase Tanning excise tax 2011 Prescription drug coverage deduction eliminated W-2 reporting SIMPLE cafeteria plans
Restrictions on use of HSA and FSA funds for over-the-counter drugs Tax on HSA distributions increases 2012 1099s required for payments to corporations Adoption credit sunset Adoption-assistance programs sunset 2013 Increase in medical deduction threshold for taxpayers under age 65 Additional hospital insurance tax on high-income taxpayers Medicare tax on investment income Fees on health plans (after Oct.
Section 125: Cafeteria Plans
, or flexible spending plans, have been part of the Internal Revenue Code for nearly 20 years.
Even under a cafeteria plan
, certain benefits may be taxable to the employee.
We provide them with 401 (k) plans and cafeteria plans
to meet their financial goals, but we encourage our employees to plan for themselves and to assume responsibility for their future needs.
Much like qualified plan disqualification, any defect in the form or operation of a cafeteria plan
would be significant: The plan would cease to be a cafeteria plan
, and all employees' benefits would be includible in taxable income.
As stated in the notice, "[t]he effect of the grace period is that the participant may have as long as 14 months and 15 days (the 12 months in the current cafeteria plan
year plus the grace period) to use the benefits or contributions for a plan year before those amounts are 'forfeited' under the 'use-it-or-lose-it' rule.
In May, the IRS endorsed using medical debit cards to pay for medications and certain health care products with untaxed income as part of employee cafeteria plans
Flexible spending accounts may be offered through a cafeteria plan
125-2(e) (1989), a cafeteria plan
may provide that a benefit will cease if an employee fails to make the required premium payments.
About 65% of revenues come from health and welfare plan services, 30% from retirement plan design, consulting and administration and 5% from payroll services and cafeteria plan
USAble Life also offers cafeteria plan
administration as permitted through Section 125 of the Internal Revenue Code, allowing employees to pay for certain benefits with pre-tax dollars.