Johearain

OP what did you end up doing? I know this is out-dated but I just stumbled on it and I'm curious. As plan sponsor (and without doing any research into it) my initial reaction probably would've been: I am not a party to this divorce so that judge can order whatever ridiculous thing he wants and that has nothing to do with me. A marriage is not dissolved for some purposes and not for others; a marriage either is or it is not. Therefore, for purposes of the Plan I administer, this decree dissolving this marriage becomes effective on the earliest date mentioned in this maniacal judge's list of different dates on which the dissolution of this marriage becomes effective. He needs to make up his mind and decide when this marriage is dissolved. And if he refuses to make up his mind, I'll make it up for him. Additionally, a divorce decree that requires one spouse to continue health insurance on another spouse for a certain period of time after a divorce has nothing to do with the date on which a QLE occurs. The QLE occurs when the divorce is final. And if your PDs say ex spouses aren't eligible as of the date of divorce, that means they aren't eligible as of the date the divorce is final. The non-employee spouse will still be entitled to COBRA. And if the employee is still under an obligation to provide the ex-spouse with health insurance for a period of time after the divorce is final, s/he may continue to do so - as a COBRA participant. The law is already complex enough without adding this kind of nonsensical "creativity" into it. Call a spade and kick the ex spouse off the plan.

I wouldn't go back and correct two years of W2s just because the employee chose to wait two years to report his marriage. I say just correct the taxes in the current year, for the current year, and move on. If the employee wants to go back two years and amend his tax returns to account for the rest of it, just provide him with the relevant figures (amount he was imputed for ER contributions and the total of his post-tax contributions from the date of the marriage through 12/31/15) and send him to H&R Block to fix it himself. W2-Cs are for reporting errors on a previously filed W2-C. I wouldn't consider this an error needing correction on the employer's part. The employee certified this person as a domestic partner, not a spouse, and you taxed him accordingly. He didn't report the marriage until now so therefore you didn't make an error on his W2. That's for him to fix. For 2016, though, I would definitely suggest correcting for the entire year - not just from the date he reported the marriage forward. There is still plenty of time left in the year to correct everything for this year before 12/31. If you only correct going forward, you are knowingly deducting him for taxes he does not owe.

If I'm understanding your question correctly, I don't believe multiple EINs in a single trust should be an issue. Unless the ownership between the two sponsoring entities is identical, the Plan would likely become a multi-employer plan which would open it up to additional reporting and disclosure requirements but over all there shouldn't be any legal concerns with the trust being funded by multiple EINs. Just make sure your plan docs are updated/amended accordingly and all required notices (primarily the SMM) are distributed timely. If the Plan becomes a multi-employer plan you will also need to file form M1 next year, which, depending on the number of employers involved, can be a real pain.

I have an employee who's wife left him and moved back to Mexico and, of course, now he wants to remove her from his benefits. They are not legally divorced yet. We are in Texas and there is no legal separation in this state. But, he says they're going to be legally separated in Mexico prior to being divorced (in Mexico). My question is whether or not a life event currently exists. I know one will exist once he's divorced or legally separated but he's wanting to drop her now. Changes in lawful immigration status can be a life event to enroll in coverage under the new ACA rules, but I can't find anything on the opposite situation. Does anyone know if a spouse moving out of the country could possibly be considered a life event to allow him to drop her from his plans? I've never run into this particular scenario before and not really sure how to proceed...

This almost sounds like a level-funded plan. If that is the case, the Plan is considered self-funded for just about all purposes, even though the sponsor isn't in the hook for claims in excess of contributions. Level-funded plans are self-funded but include a stop loss component to protect the sponsor from incurring claims in excess of funding. But, the reinsurer usually requires the Plan to be funded at maximum liability, rather than minimum. So the fact that they're funding at minimum makes me think it may not be "level-funded." I would suggest asking the agent that sold the Plan if it's considered level-funded. If it is, it's self-funded and the Plan sponsor is responsible for all of the reporting. If it isn't....I have no idea who's ultimately responsible.

Preface: I am a benefits administrator at a PEO. PEOs are the employer of record for all federal taxes and for SUTA taxes in the majority of states. There are only a handful of "client reporting" states, wherein the PEO acts as the reporting agency but files and pays SUTA under the client's name/EIN - Missouri and New York come to mind. SUTA claims in PEO reporting state fall back on the PEO at least while the client is still with the PEO and in some states even after the client leaves the PEO. PEOs are also permitted to, and most do, sponsor health and welfare plans for their worksite employees. There is nothing, legally speaking, that prevents a client company from sponsoring their own benefit plans but most PEOs require the client companies to adopt the PEO's plans in their service agreement. Of those that will allow a client company to adopt their own plans, most will not touch them for anything other than payroll deductions, which are given back to the client on the payroll invoice. To answer your original question, it depends on who the plan sponsor is. If an employee works for a worksite employer (client) and is covered by a health plan that is sponsored by the PEO and that employee later moves to another worksite employer that also offers the PEO's health plan, the waiting period should not start over (unless there was a significant lapse of time between DOT at the first worksite employer and DOH at the second). If the health plan was sponsored by the worksite employer, the waiting period would start over unless both worksite employers offer the same plan - IE: Company A and Company B are commonly owned but are separate legal entities so they have separate contracts with the PEO but share the same (client sponsored) health plan and all employees of A and B are covered by that same client sponsored plan. It is theoretically possible that the PDs of the PEO sponsored health plans could require the employee to satisfy the WP again if they change worksite employers AND those worksite employers aren't related to each other in any way (common control or ownership) but I would be something more than shocked if this were actually written into the PD....that would be an ERISA/125 nightmare and I don't know anyone who would want to deal with that kind of a loophole.

An SMM is sufficient and since this doesn't require a change to your SBC, you're under no obligation to provide the SMM in advance. Under ERISA, you have 210 days from the end of the plan year in which you adopt the amendment to provide the SMM. I would definitely suggest adding the verbiage to your OE communications but you're in no rush to distribute the SMMs. We're doing something similar with our commuter expense accounts this year and for internal operations reasons we just decided to adopt for PY 2016 instead of adopting for this year. But, if your client wants to add the rollover for 2015 funds into PY 2016, they just need to execute the amendment by 12/31 and notify participants with 210 days. The question I would ask is why are they wanting to make this change now, so late in the year? If their reason for doing this is because they want to allow an HCE or KE to rollover funds that s/he would otherwise lose, they may find themselves stuck between the devil and the deep blue sea trying to explain that one if their plan is audited....if this is the case, or if it could even appear this is the case, they need to make certain they plaster that verbiage everywhere they can during OE to lessen the validity of any argument that the plan was amended for the benefit of an HCE or KE...make sure the "little guy" knows he can roll over his unused funds, too.

Judging by my inability to find anything useful about this anywhere on the Internet, I'm assuming this situation is anything but common. Here goes: I have the following benefit plans with the following plan years: 125 plan: calendar year FSAs (GP, LP, DCA, CE): calendar year Medical: 11/1 - 10/31 All ancillary: 10/1 - 9/30 And I don't even have a guess as to what my ERISA plan year is but I'm guessing it's calendar year. Basically, I'm cleaning up a giant mess left over from years of people who had no business administering benefits. The only thing I want to do is term everything in December and start over on 1/1, but for various reasons let's just assume that none of these plan years can change. I cannot bring the medical in line with the ancillary, I cannot bring the 125 in line with anything else, and the FSA cannot be anything other than the calendar year. On top of all that, everything but the medical is MEWA (not Taft-Hartley). I can't find anything to tell me one way or another whether there is a problem with having all of your plans renew at different times than your 125 plan. I've never heard of anyone doing this so for all I know it could be perfectly fine but my gut tells me there are about a thousand ways for this thing to go wrong. So my question is: Is this legal? Are there any compliance concerns with having your underlying plans renew at a different time than your 125 plan? Do I have to allow employees to change their medical election when the 125 plan renews (since they're taking medical in lieu of cash under the 125 plan) in January even though the insurance contract doesn't renew again until November? If I allow employees to make an election change (with respect to pretax premium deductions) when the medical plan renews in November, is that technically not permitted under the 125 plan? Unless maybe if it also happens to satisfy the change in costs/coverage LE? If I can't let them change their election with the underlying plan changes in the middle of the 125 plan year, I'm assuming we would just have a midyear rate change? What? No.... I'm so completely confused right now I'm not even sure I worded my questions correctly. In all the years I've been doing this I've never heard of an employer who decided "hey I think I'll have all my benefit plans renew at different times of the year because that's fun for me...three open enrollments every year...splendid plan, Bob! Pass the biscuits!" Ugh. Help?