Tuesday, December 4, 2018

Reporting Deadline Extended for 1095 Forms

The IRS recently announced a new deadline for Form 1095-C distribution. While the forms must be filed with the IRS by April , the deadline for distributions to employees was delayed by a month. Please see below for the new dates.

2018 Forms Sent
to Individuals
Form 1095-B
Form 1095-C

Filing Forms 1094-B, 1095-B, 1094-C, or 1095-C with the IRS: The deadline for those forms is 2/28/19 for those with 250 or fewer forms filing by paper, and 4/1/19 for electronic filing.

Tuesday, November 20, 2018

IRS Announces 2019 Contribution Limits

The IRS recently released the 2019 annual inflation adjustments for Flexible Spending Accounts (FSA) and Qualified Transportation Benefits (QTB). 

See below for adjusted 2019 contribution limits compared to the current 2018 limits.

Plan Type
Flexible Spending Accounts (FSA)
Health Savings Account (HSA)
Individual: $3,450 
Family: $6,900
Individual: $3,500 
Family: $7,000
Commuter Reimbursement Accounts (CRA/Parking, Transit)
Qualified Small Employer Health Reimbursement Arrangements (QSEHRA)
Individual: $5,050
Family: $10,250
Individual: $5,150
Family: $10,450

They have also recently announced the adjusted dollar amount for PCORI fees is $2.45 for plan and policy years ending on or after October 1, 2018 and before October 1, 2019 (up from $2.39).

Wednesday, June 6, 2018

New Jersey Enacts Individual Mandate

On May 30, 2018 Governor Phil Murphy signed the “shared responsibility tax” bill into law. The law is similar to the ACA’s Individual Mandate, takes effect on January 1, 2019, and requires New Jersey residents to maintain health insurance coverage with minimum essential coverage.

New Jersey’s new mandate will assess an annual penalty for non-compliance of 2.5% of a  household’s income, or $2,085, whichever is greater. A hardship exception will be announced later this year.

Monday, June 4, 2018

2019 ACA Affordability Threshold Increased to 9.86%

On May 22nd the IRS announced the adjusted affordability contribution percentage for all plans starting after December 31, 2018. Up from 9.56% in 2018, an employee’s required contribution to a benefit plan cannot exceed 9.86% of their annual household income for the plan to be considered “affordable” under the ACA. Since employers don’t know their employees’ household incomes, the following three safe harbors were put in place by the ACA to be used in lieu of household income: 

Form W-2 Wages Safe Harbor
 The employee’s W-2 wages, as reported in Box 1, as of the first day of the plan year. Example: Under the W-2 Wages Safe Harbor, in 2019, if an employee’s Box 1 wages are $30,000 then that employee’s required monthly contribution for the lowest individual coverage that meets minimum value can be no more than $246.50 ($30,000 X .0986 divided by 12) for the offer to be considered “affordable”. This calculation assumes the employee was employed with the company for the entire year and offered coverage for all 12 months. Note: If an employee is not employed for the entire year or there is a waiting period, an adjustment is made to the W-2 wages to account for this as follows: W-2 wages X (calendar months offered coverage / months of employment)

 Rate of Pay Safe Harbor
The employee’s hourly rate of pay x 130 hours, as of the first day of the plan year, regardless of how many hours the employee actually worked. Example: Under the Rate of Pay Safe Harbor, in 2019, if an hourly employee earns $15 an hour then that employee’s required monthly contribution for the lowest individual coverage that meets minimum value can be no more than $192.27 ($15 X 130 X .0986) for the offer to be considered “affordable”. 

Federal Poverty Level Safe Harbor 
Since the individual Federal Poverty Level (FPL) isn’t officially published until January, employers can use the FPL in effect six months prior to the beginning of the plan year. Example: Under the Federal Poverty Level Safe Harbor, for January 2019, the maximum monthly employee contribution for the lowest individual coverage offered that meets minimum value can be no more than $99.75 to be considered “affordable” ($12,140 (2018 FPL) X .0986 divided by 12).