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Retiree HRAs


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Guest modoca

Can an employer contribute to an HRA on behalf of active employees and prohibit benefits from being used until the participant reaches retirement age? Would this fall under the retiree-only exemption?

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ERISA 732(a) and IRC 9831(a) refer to plans that have less than 2 participants who are current employees.

Unless you know of another IRC or ERISA section that trumps the above, then no because your scenario involves current employees.

I got the section reference from here: http://www.gpo.gov/fdsys/pkg/FR-2010-06-17/pdf/2010-14488.pdf

Kurt Vonnegut: 'To be is to do'-Socrates 'To do is to be'-Jean-Paul Sartre 'Do be do be do'-Frank Sinatra

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I do not think that it would be regarded as being retiree only because it involves current employees.

It is not normal, outside of the public sector, to pre-fund retiree health benefits, but to instead pay-as-you-go. However, those that do use either a 401(h) or a VEBA.

George D. Burns

Cost Reduction Strategies

Burns and Associates, Inc

www.costreductionstrategies.com(under construction)

www.employeebenefitsstrategies.com(under construction)

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  • 1 year later...

Regarding the pre-funding of retiree health benefits. You might want to look at these which should all be available at irs.gov :

PLR 9219023

PLR 201345020

PLR 201245010

PLR 201003007

George D. Burns

Cost Reduction Strategies

Burns and Associates, Inc

www.costreductionstrategies.com(under construction)

www.employeebenefitsstrategies.com(under construction)

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