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Showing results for tags 'non-discrimination testing'.
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Hello all, I started a new job, and my team has told me that we failed section 129 non-discrimination test last year and made the appropriate adjustments prior to the end of the plan year. But they have told me that the W-2s still reflected the full election/contribution amount and not adjusted for the amounts that were considered taxable therefore added as imputed income. I just spoke Payroll, and they said this is how it should be done. But I have also read that only the amount considered pre-tax (tax favored) should be reported on the W-2 box 10. Does anyone know what is correct or is either fine as long as the imputed income is reflected correctly for the plan year? Thank you! -
We have a small employer with less than 15 employees, they offer a group health plan to employees with ER paying 25% of premium and EE's paying remaining 75% of premium. ER also pays 100% of 1 Key EE's insurance outside of the Cafeteria Plan as a general business expense. When running the necessary non-discrimination tests for the Cafeteria Plan we are including both the ER Paid and the EE Paid premiums for the Health insurance. (1) Is it proper or is ER permitted to exclude the Key EE premiums paid as these were paid outside of the Cafeteria Plan as a general business expense? or does this ER paid premium amount need to be factored in for our Non-Discrimination testing? (2) If the above is not permitted, can we elect to run our Non-Discrimination testing only looking at the EE's portion of the Health Insurance premiums being paid? Thus the ER paid premiums would not be included in the Non-Discrimination testing. Problem is that with the Key EE's ER paid insurance premiums factored in the Cafeteria Plan fails the 25% concentration test. Thank you for any assistance with this question - Nathan
