MRestum

Section 125(g)(3)(B)(i) is referencing eligibility for the cafeteria plan, not the underlying benefits offered under the cafeteria plan. Thus, while eligibility for a fully-insured health plan could be structured in that manner, the employer should require officers to wait 60 days to make pre-tax contributions under the cafeteria plan. That is, they should be required to make only post-tax contributions until they have satisfied the cafeteria plan's 60-day waiting period. The other option would be to create two cafeteria plans with different waiting periods (assuming both can pass eligibility testing).

I often advise employers to be careful about intentionally limiting an employee’s work hours to prevent the employee from becoming eligible for health plan coverage. That strategy has potential legal risk under ERISA §510.

It depends on the situation. For example, each employer member of a controlled group must complete and file its own 1095-Cs. If the subsidiary was an employer member of the seller's controlled group, they should have been filing their own 1095-Cs, and that would continue if they became an employer member of the buyer's controlled group. The only thing that would have changed is the plan in which the acquired company's employees were covered.

What you are missing is IRS Private Letter Ruling 200802003 that addresses mandatory pre-tax employee contributions to an HRA.

This is a tricky one because you were likely supposed to notify your COBRA plan when you became enrolled in other employer-sponsored coverage. If a claim is filed and they find out you had other coverage for that month, they could potentially terminate your COBRA retroactively back to the day before your new coverage is effective. You might want to check your if your COBRA plan required such notification before counting on having two coverages for that month.

I have been taking the position that CAA did not change the $5,000 limit* on non-taxable reimbursements in a calendar year so its likely the carryover amount would by default limit the amount the employee could elect in Year 2 on a non-taxable basis to ($5,000 - the carryover amount). If the carryover amount plus the employee's Year 2 election exceeds $5,000, then reimbursements in excess of $5,000 for claims incurred during the calendar year would have to be treated as taxable income. *$5,000 is the maximum non-taxable amount but there are situations where an employee's maximum will be less than $5,000.

Can I do this: Never read another regulation and then complain about the regulations and have someone here explain them all to me?

Page 21 of the Form 5500 Instructions - "Schedule A (Form 5500) must be attached to the Form 5500 filed for every defined benefit pension plan, defined contribution pension plan, and welfare benefit plan required to file a Form 5500 if any benefits under the plan are provided by an insurance company, insurance service, or other similar organization (such as Blue Cross, Blue Shield, or a health maintenance organization)."

You need to advise this client to hire someone who is an expert in welfare benefits.

If you are a large employer, see 26 CFR § 54.4980H-3(g) HERE If your employee’s payment is late, you must provide the employee with a 30-day grace period in order to make the payment. If your employee does not make the payment within the grace period, you are not required to provide coverage for the period for which the premium is not timely paid and may terminate coverage. In addition, you are treated as having offered that employee coverage for the remainder of the coverage period (typically the remainder of the plan year) and cannot be penalized for terminating coverage if the premium is not paid. Similarly, if the employee makes a partial payment that is "not significantly less" than the total amount due (the lesser of 10% of what is due or $50), you must either accept the deficient payment as payment in full or notify the employee in writing of the underpayment and give the employee a reasonable amount of time to pay the remaining balance.

The employee in your example should not receive a 1095-C. Per the 1094/1095-C Instructions: An ALE Member need not file a Form 1095-C for an individual who for each month of a calendar year is either not an employee of the ALE Member or is an employee in a Limited Non-Assessment Period with respect to section 4980H(b). Waiting periods are treated as Limited Non-Assessment Periods.

According to the 5500 Instructions, "Health and welfare plans that meet the conditions of the limited exemption at 29 CFR 2520.104-44 or Technical Release 92-01 are not required to complete and file a Schedule C."