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Compliance Corner

Announcements

New Podcast Episode Coming Soon

April 13, 2021

We will record the next podcast as soon as possible. Please check back here next week for the latest episode.

Every other week, NFP's legal experts make the subject of compliance personal for a wide audience. By breaking down the daunting details of emerging policies and bridging the gap between legislation and what it means for the listener, Chase Cannon and Suzanne Spradley make compliance issues relatable and relevant. Visit our Soundcloud page every two weeks for the most up-to-date episode.

Listen on Google Play Music

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Reminder: 2020 HSA Contributions and Corrections Deadline May 17

April 13, 2021

Individuals who were HSA-eligible in 2020 have until the tax filing deadline to make or receive contributions. The IRS recently extended the 2020 tax-filing deadline, so 2020 HSA contributions must generally be made by May 17, 2021. This includes employer contributions. The 2020 contribution limit is $3,550 for self-only coverage and $7,100 for any tier of coverage other than self-only. Those aged 55 and older are permitted an additional catch-up contribution of $1,000. An individual’s maximum annual contribution is limited by the number of months they were eligible for the HSA.

There is an exception to this rule. An individual that was HSA eligible on December 1 is permitted to contribute the full statutory maximum for the year. However, if eligible employees do not remain HSA eligible through December of the following year, they may experience tax consequences.

Individuals who contributed more than the allowable amount for 2020 should be refunded the excess contributions and associated interest by May 17, 2021. The excess would be subject to income tax. If the excess is not refunded from the account, it will not only be subject to income tax, but also a 6% excise tax penalty. If an employer is aware of an employee who was not eligible for a contribution or who has contributed more than the allowable amount for 2020, they should work with the HSA bank/trustee to process the excess contribution.

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ARPA Benefits Compliance Webinar Series – Register Now

April 13, 2021

Join the Benefits Compliance team for the third installment of our webinar series on the American Rescue Plan Act of 2021. This webinar is meant to clear up unanswered questions relating to the law’s requirements, discuss government guidance and address the steps employers will need to take to comply with the law.

ARPA Benefits Compliance Updates and FAQ
April 14, 2021
2:00 to 3:00 p.m. CT (3:00 to 4:00 p.m. ET)

Register Now

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Podcast Episode 102: COBRA Subsidies under the American Rescue Plan Act of 2021 (ARPA)

March 30, 2021

In this special episode, Suzanne Spradley and Chase Cannon discuss the COBRA subsidies that are a big part of the recently-enacted ARPA. Suzanne starts the discussion with a history of past COBRA subsidies, including in 2002 and 2008/09, comparing them to the ARPA subsidies. Suzanne then answers Chase’s rapid fire questions on the ARPA COBRA subsidies, including the amount and duration, who is eligible, employer involvement, notice requirements, and interactions with COBRA administrators and vendors.

Every other week, NFP's legal experts make the subject of compliance personal for a wide audience. By breaking down the daunting details of emerging policies and bridging the gap between legislation and what it means for the listener, Chase Cannon and Suzanne Spradley make compliance issues relatable and relevant. Visit our Soundcloud page every two weeks for the most up-to-date episode.

Listen on Google Play Music

Read More

American Rescue Plan Act (ARPA) Benefits Compliance Webinar Series – Register Now

March 30, 2021

Join the Benefits Compliance team for a three-part webinar series on the American Rescue Plan Act of 2021 (ARPA). This webinar is meant to clear up unanswered questions relating to the law’s requirements (including COBRA subsidies), discuss government guidance, and address the steps employers will need to take to comply with the law.

ARPA Benefits Compliance Updates and FAQ
March 31, April 7 and April 14, 2021
2:00 to 3:00 p.m. CT (3:00 to 4:00 p.m. ET)

Register Now

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Final Reminder: Upcoming IRC 6055 and 6056 Reporting Deadlines

March 30, 2021

Employers that were ALEs in 2020 must comply with IRC Section 6056 reporting in early 2021. Specifically, ALEs must complete and distribute a Form 1095-C to full-time employees by March 2, 2021 (the IRS changed this from January 31, 2021). The form should detail whether the employee was offered minimum value, affordable coverage during 2020. The forms may be mailed, electronically delivered or delivered by hand (although proof of delivery in some manner is recommended).

If an employer sponsored a self-insured plan during 2020, it must comply with Section 6055 reporting in 2021. Self-insured employers with 50 or more FTEs must complete Section III of Form 1095-C detailing which months the employee (and any applicable spouse and dependents) had coverage under the employer’s plan. If the self-insured employer has fewer than 50 FTEs, it must complete and distribute a Form 1095-B with such information. Again, the forms must be delivered to employees by March 2, 2021.

Employers must also file the forms with the IRS by March 1, 2021 (as February 28, 2021, falls on a Sunday), if filing by paper, and March 31, 2021, if filing electronically. Those that are filing 250 or more forms are required to file electronically. Lastly, the employer is required to file the transmittal Form 1094-C (if filing Forms 1095-C) or Form 1094-B (if filing Forms 1095-B).

As a reminder, the IRS recently provided penalty relief for employers that will allow them to forgo distributing the Form 1095-B to individuals. This comes after the IRS accepted comments on the necessity of the Forms 1095-B now that the individual mandate penalty has been zeroed out. If employers post a notice on their website that the document is available upon request, and fulfil any such request within 30 days, then they will not have to distribute the Forms 1095-B to covered individuals. But keep in mind that there is no such penalty relief for Form 1095-C.

Form 1094-B »
Form 1095-B »
Form 1094-C »
Form 1095-C »
Instructions for Forms 1094-B and 1095-B »
Instructions for Forms 1094-C and 1095-C »

Read More

Reminder: 2020 HSA Contributions and Corrections Deadline May 17

March 30, 2021

Individuals who were HSA-eligible in 2020 have until the tax filing deadline to make or receive contributions. The IRS recently extended the 2020 tax-filing deadline, so 2020 HSA contributions must generally be made by May 17, 2021. This includes employer contributions. The 2020 contribution limit is $3,550 for self-only coverage and $7,100 for any tier of coverage other than self-only. Those aged 55 and older are permitted an additional catch-up contribution of $1,000. An individual’s maximum annual contribution is limited by the number of months they were eligible for the HSA.

There is an exception to this rule. An individual that was HSA eligible on December 1 is permitted to contribute the full statutory maximum for the year. However, if eligible employees do not remain HSA eligible through December of the following year, they may experience tax consequences.

Individuals who contributed more than the allowable amount for 2020 should be refunded the excess contributions and associated interest by May 17, 2021. The excess would be subject to income tax. If the excess is not refunded from the account, it will not only be subject to income tax, but also a 6% excise tax penalty. If an employer is aware of an employee who was not eligible for a contribution or who has contributed more than the allowable amount for 2020, they should work with the HSA bank/trustee to process the excess contribution.

Read More

Podcast:

March 16, 2021

We will record the next podcast as soon as possible. Please check back here next week for the latest episode.

Every other week, NFP's legal experts make the subject of compliance personal for a wide audience. By breaking down the daunting details of emerging policies and bridging the gap between legislation and what it means for the listener, Chase Cannon and Suzanne Spradley make compliance issues relatable and relevant. Visit our Soundcloud page every two weeks for the most up-to-date episode.

Listen on Google Play Music

Read More

Reminder: Upcoming IRC 6055 and 6056 Reporting Deadlines

March 16, 2021

Employers that were ALEs in 2020 must comply with IRC Section 6056 reporting in early 2021. Specifically, ALEs must complete and distribute a Form 1095-C to full-time employees by March 2, 2021 (the IRS changed this from January 31, 2021). The form should detail whether the employee was offered minimum value, affordable coverage during 2020. The forms may be mailed, electronically delivered, or delivered by hand (although proof of delivery in some manner is recommended).

If an employer sponsored a self-insured plan during 2020, it must comply with Section 6055 reporting in 2021. Self-insured employers with 50 or more FTEs must complete Section III of Form 1095-C detailing which months the employee (and any applicable spouse and dependents) had coverage under the employer’s plan. If the self-insured employer has fewer than 50 FTEs, it must complete and distribute a Form 1095-B with such information. Again, the forms must be delivered to employees by March 2, 2021.

Employers must also file the forms with the IRS by March 1, 2021 (as February 28, 2021 falls on a Sunday), if filing by paper, and March 31, 2021, if filing electronically. Those that are filing 250 or more forms are required to file electronically. Lastly, the employer is required to file the transmittal Form 1094-C (if filing Forms 1095-C) or Form 1094-B (if filing Forms 1095-B).

As a reminder, the IRS recently provided penalty relief for employers that will allow them to forego distributing the Form 1095-B to individuals. This comes after the IRS accepted comments on the necessity of the Forms 1095-B now that the individual mandate penalty has been zeroed out. If employers post a notice on their website that the document is available upon request, and fulfil any such request within 30 days, then they will not have to distribute the Forms 1095-B to covered individuals. But keep in mind that there is no such penalty relief for Form 1095-C.

Form 1094-B »
Form 1095-B »
Form 1094-C »
Form 1095-C »
Instructions for Forms 1094-B and 1095-B »
Instructions for Forms 1094-C and 1095-C »

Read More

March 17 Get Wise Wednesdays Webinar – Register Now

March 16, 2021

Join us as we discuss common HSA compliance matters. Among other HSA topics, we will clarify eligibility rules, discuss the mechanics of HSA contributions, and address how to handle certain mistakes. By the end of the session, participants should better understand HSA eligibility and contribution rules, as well as how to identify and remedy some of the common issues associated with HSAs.

HSAs – How to Maintain Compliance with the Pot of Gold
March 17, 2021
2:00 to 3:00 p.m. CT (3:00 to 4:00 p.m. ET)
Register Now »

A recording will be posted to the NFP Client Learning Portal within 48 hours of the live webinar. Those listening to a recorded webinar aren’t eligible for recertification credit.

All programs are pending approval for 1.0 (general) recertification credit hour toward PHR, SPHR and GPHR recertification through the HR Certification Institute. For more information about certification or recertification, visit the HR Certification Institute website at www.hrci.org.

HSA White Paper Available Soon!
Our whitepaper on HSAs is in the final stages of development and will be available very soon.

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