Domestic Partner Children

[Guest ip0905]

I believe I am over complicating this, but I need assistance on how other cafeteria plans calculate imputed income for the children of domestic partners.

Example - Employee is covering his/her "152" qualified children on the plan today and adds their domestic partner and domestic partner children. I can easily figure out the pre and post tax cost of adding the domestic partner and the imputed income for the domestic partner. I am having trouble trying to figure out the pre and post tax cost along with the imputed income for the domestic partners children.

This is the first time our plan is offering this and any assistance or examples would help.

Thank you.

[SLuskin]

If the policy cost is the same for 1 child or 12 children, we haven't been adding any imputed income for the domestic partner children. However, if there is 1 charge for EE + 1 child and a different charge for EE + 2 or more children, we have been imputing the cost of that first child to the domestic partner.

[GMK]

Sorry to muddy the water, but our understanding is that each covered person who does not qualify as a tax dependent is counted for imputed income. That is, for example, if the employee already has family coverage and adds coverage for a non-tax dependent, we have to compute imputed income for that non-tax dependent's coverage, even though the premium does not increase.

[QDROphile]

I think GMK's position is more tenable. The "no marginal cost" approach is aggressive.

[MARYMM]

Sorry to muddy the water, but our understanding is that each covered person who does not qualify as a tax dependent is counted for imputed income. That is, for example, if the employee already has family coverage and adds coverage for a non-tax dependent, we have to compute imputed income for that non-tax dependent's coverage, even though the premium does not increase.

We were advised by counsel to do it this way. We use the single premium cost as the Fair Market value for each non-tax dependent covered.

Using the COBRA cost was another option given to us.