KJohnson

See 125 (g)(3) employment requirement for each employee must be the same... (3)Certain participation eligibility rules not treated as discriminatory. For purposes of subparagraph (A) of subsection (b)(1), a classification shall not be treated as discriminatory if the plan— (A) benefits a group of employees described in section 410(b)(2)(A)(i), and (B)meets the requirements of clauses (i) and (ii): (i)No employee is required to complete more than 3 years of employment with the employer or employers maintaining the plan as a condition of participation in the plan, and the employment requirement for each employee is the same. (ii)Any employee who has satisfied the employment requirement of clause (i) and who is otherwise entitled to participate in the plan commences participation no later than the first day of the first plan year beginning after the date the employment requirement was satisfied unless the employee was separated from service before the first day of that plan year.

Seems like you are allowing them to elect to take the match as a taxable benefit (student loan repayment) which would make the match part of your CODA as well--likely creating 402(g) and other problems..

Would love to see the letter as well if you could post a redacted version. There were "5699" letters that went out where the IRS determined there might be a failure to file. Those were legitimate. https://eforerisa.files.wordpress.com/2017/06/letter-5699.pdf

Depends on whether they are plan assets. (2013-03A referenced above). If they are, many reference Rev. Rul. 80-155 for the notion that you can't have unallocated plan assets at the end of the plan year in a DC plan for the plan to remain qualified. See the Spring 2010 edition of the IRS retirement plan news where they talk about this with regard to forfeitures. Here is something good. Look at slide 11... www.wagnerlawgroup.com/documents/ProgramSlides.ppt

I would make sure you are confident there are no plan assets and you still fall under Technical Release 92-01. This can be tricky with stop loss. https://www.dol.gov/agencies/ebsa/employers-and-advisers/guidance/advisory-opinions/2015-02a In particular these four factors. First, except for the use of participant contributions to partly fund the medical benefit portions of the Plans, the facts surrounding the purchase of the Policies will be identical in all material respects to the facts surrounding the purchase of the stop-loss insurance policy described in Advisory Opinion 92-02A. Second, with respect to the use of participant contributions to fund in part the benefits under the Plans, you have put in place an accounting system that ensures that the payment of premiums for the Policies includes no employee contributions. Third, the purchase of such insurance will not relieve the Plans of their obligation to pay benefits to Plan participants, and the stop-loss insurer has no obligation to pay claims of Plan participants. Fourth, the Policies will reimburse the Plan Sponsors only if the Plan Sponsors pay claims under the Plans from their own assets so that the Plan Sponsors will never receive any reimbursement from the insurer for claim amounts paid with participant contributions.

Unlikely to be reimbursable because the spouse was probably pre-taxing the premium through his/her 125 plan. Reimbursing from the HRA on a tax free basis would be an impermissible double dip.

Might want to look at TAM 9735001 https://benefitslink.com/src/irs/tam9735001.html Slides 4 and 5 of this relatively recent ASPAA program are good https://www.asppa.org/Portals/2/PDFs/2016AnnualHandouts/WS63 - The Anti-Cutback Rules of IRC 411d6.pdf Seems to me that nobody has accrued any benefit for the year under the old formula and you should be able to amend even if the new formula has no allocation conditions.

Does it waive the accrual requirement for death, disability and retirement? And, if it does is there anyone that has had one of those events?

Also on 406(a) http://www.benefitscollective.com/wiki/EBSA_Advisory_Opinion_1993-18A With regard to your first question, the Department has addressed the issue of whether related plans are parties in interest with respect to one another in Prohibited Transaction Exemption 76-1 (41 Fed. Reg. 12740, 12744, March 26, 1976). As explained in the preamble to that exemption, two or more plans are not parties in interest with respect to each other merely because they are maintained by the same plan sponsors or have trustees or fiduciaries who are common to the plans. A plan may be a party in interest with respect to another plan, however, if it has a relationship to the plan as defined in section 3(14) of ERISA. For example, a plan may be a party in interest with respect to another plan under section 3(14)(B) of ERISA if it provides services to such plan.<

You may want to look at this prior post if this is an ERISA 403(b) plan.

I think the reasoning would be it is an employer payment plan. But its an employer payment plan for excepted benefits--so no ACA issues. The guidance on employer payment plans, however, says that the employer payment plan itself (i.e. reimbursing for individual policies) is a group health plan IRS Notice 2013-54, and DOL Tech. Rel. 2013-03. And, if it is a group health plan then COBRA applies. Just saying what the reasoning might be--not whether it is wrong or right.

Always issues in offering individual coverage. First 125 plan has to provide for it. Second the dental would have to be an excepted benefit under HIPAA/ACA (probably is). If it was not then you may have employer payment plan issues. See e.g. Notice 2015-87, ACA FAQs Part XXII. Third offering it through a 125 plan arguably takes it out of voluntary benefits exemption form ERISA so there could be ERISA issues (plan document SPD). Finally also a question of whether this is now part of group coverage and covered by COBRA. (How do you offer COBRA for an individual policy?)

If your amendment grandfathers in the son (who I assume is an HCE by attribution) you might want to look at § 1.401(a)(4)-5. Not saying it is a problem. Its a facts and circumstances determination. The reg provides some examples on the timing of plan amendments and discrimination. But grandfathering in a class of individuals at a time when only an HCE is in the class being grandfathered might raise an issue.

Derrin Watson appears to agree with Kevin C. See Example 18.10.4 in the 6th Edition

If owner B is an HCE with Owner A did you rule out a B-Org ASG?

FWIW https://www.irs.gov/retirement-plans/how-to-obtain-or-re-establish-an-ein-for-a-retirement-plan-trust

Just a PLR but the "require that controlled group members exist concurrently" comment might be relevant http://employerbook.hypermart.net/PLR9541041.htm The operation of section 414(b), (c) and (m) and the regulations thereunder necessarily require that controlled group members exist concurrently. Accordingly, with respect to the first ruling, we conclude that the Predecessor Employer and Employer B are not members of a controlled group of corporations or other entities nor members of an affiliated service group for purposes of section 414(b), (c) and (m).

Agree. The ACA market reforms require no life time or annual limits that an FSA would never be able to meet. So, you need to keep the health FSA an excepted benefit. There are two conditions to keep it an excepted benefit: a maximum benefit condition and an availability condition. If someone is eligible for the FSA but not eligible for the group medical plan then you have not met the availability condition and are potentially subject to a $100 per day per employee ($36,500 per year per employee) excise tax under 4980D for each employee in the FSA.

I remember asking this at the mid-Atlantic conference a number of years back under 2003-44. They originally said ok for SCP and then came back later in the Q&A session and said no --that VCP was your option here.. At that time the provision was just "ineligible employee.' I think then in 2006-27 and later iterations they changed it from "inclusion of an ineligible employee" to "inclusion of an otherwise eligible employee" maybe in an attempt to make it clearer?

Look at Notice 2015-87, Q&A 9

Here is an article. Note the author... https://publichealth.gwu.edu/departments/healthpolicy/DHP_Publications/pub_uploads/dhpPublication_3B1BC1E8-5056-9D20-3DBD5F020B65EED3.pdf

With regard to age, here is what that EEOC compliance manual says about the ADEA http://www.eeoc.gov/policy/docs/benefits.html#5. 5. Benefit plans funded solely or in part by employees The following equal cost rules apply where an employer requires that employees contribute to the funding of available benefits and where the premium for those benefits increases with age.(20) An older employee may not be required to pay more for the benefit as a condition of employment. Where the premium has increased for an older employee, the employer must offer the employee the option of withdrawing from the benefit plan altogether. The employer can alternatively offer the employee the option of reducing his/her benefit coverage in order to keep his/her premium cost the same. An older employee who chooses to participate in a voluntary plan can be required to pay more for the benefit, but only if the employee does not pay a greater percentage of his/her premium cost than younger employees do. An older employee may be offered the option of paying - or paying more -- for the benefit in order to avoid otherwise justified reductions in coverage. Where the employee does choose to pay more, s/he can be charged no more than the amount that is necessary to maintain full coverage. EXAMPLE - Employer K requires that each of its employees enroll in the company's health plan and pays for 40% of the premium cost for each employee. When CP turns 60, K's insurer notifies K that it will increase the premium for CP's health insurance by 10%. K tells CP that it can no longer afford to pay 40% of the cost for his health insurance, and that he will be required to pay the additional charge himself. K says that because all of its employees must have the same health insurance, it will be forced to terminate CP if he fails to pay the additional premium cost. Because CP is now being forced to pay more for his insurance as a condition of employment, this violates the ADEA. EXAMPLE - Employer Z offers its employees the option to enroll in its disability benefits plan, but requires that they pay 100% of the premium cost. The premium cost rises as employees grow older; 60 year old employees thus must pay more for the disability benefits coverage offered by Z than 55 year old employees do. As long as the premium increases do not exceed the amount necessary to maintain the same level of coverage for older and younger workers, this is permissible. Enrollment in the plan is voluntary, and employees of all ages bear the same percentage -- here 100% -- of the cost of coverage for their age.

54.4980H-5(e)(2)(ii) (e) Affordability—(1) In general. An employee who is offered coverage by an applicable large employer member may be eligible for an applicable premium tax credit or cost-sharing reduction if that offer of coverage is not affordable within the meaning of section 36B©(2)©(i) and the regulations thereunder. (2) Affordability safe harbors for section 4980H(b) purposes. The affordability safe harbors set forth in paragraph (e)(2)(ii) through (iv) of this section apply solely for purposes of section 4980H(b), so that an applicable large employer member that offers minimum essential coverage providing minimum value will not be subject to an assessable payment under section 4980H(b) with respect to any employee receiving the applicable premium tax credit or cost-sharing reduction for a period for which the coverage is determined to be affordable under the requirements of an affordability safe harbor. This rule applies even if the applicable large employer member’s offer of coverage that meets the requirements of an affordability safe harbor is not affordable for a particular employee under section 36B©(2)©(i) and an applicable premium tax credit or cost-sharing reduction is allowed or paid with respect to that employee. (i) Conditions of using an affordability safe harbor. An applicable large employer member may use one or more of the affordability safe harbors described in this paragraph (e)(2) only if the employer offers its full-time employees and their dependents the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan that provides minimum value with respect to the self-only coverage offered to the employee. Use of any of the safe harbors is optional for an applicable large employer member, and an applicable large employer member may choose to apply the safe harbors for any reasonable category of employees, provided it does so on a uniform and consistent basis for all employees in a category. Reasonable categories generally include specified job categories, nature of compensation (hourly or salary), geographic location, and similar bona fide business criteria. An enumeration of employees by name or other specific criteria having substantially the same effect as an enumeration by name is not considered a reasonable category. (ii) Form W-2 safe harbor–(A) Full-year offer of coverage. An employer will not be subject to an assessable payment under section 4980H(b) with respect to a full-time employee if that employee’s required contribution for the calendar year for the employer’s lowest cost self-only coverage that provides minimum value during the entire calendar year (excluding COBRA or other continuation coverage except with respect to an active employee eligible for continuation coverage) does not exceed 9.5 percent of that employee’s Form W-2 wages from the employer (and any other member of the same applicable large employer that also pays wages to that employee) for the calendar year. Application of this safe harbor is determined after the end of the calendar year and on an employee-by-employee basis, taking into account the Form W-2 wages and the required employee contribution for that year. In addition, to qualify for this safe harbor, the employee’s required contribution must remain a consistent amount or percentage of all Form W-2 wages during the calendar year (or during the plan year for plans with non-calendar year plan years) so that an applicable large employer member is not permitted to make discretionary adjustments to the required employee contribution for a pay period. A periodic contribution that is based on a consistent percentage of all Form W-2 wages may be subject to a dollar limit specified by the employer.