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IRS Catches Up on Roth Catch-Up Regulations: Action Needed Now

"[D]ecisions that plan sponsors need to make before the statutory requirements take effect starting January 1, 2026 [include]: [1] Will the plan implement deemed Roth contributions? [2] Will the plan aggregate some or all of the employers participating in the plan within the same controlled or affiliated service group and/or using the same common paymaster? If yes, which companies will be aggregated for this purpose?"

ACA Affordability Threshold and Employer Shared Responsibility Penalties Increase for 2026

"Plan sponsors should take immediate action to determine if their 2026 plan design for premium cost-sharing does not create an issue with the new affordability threshold. Presumably, plan sponsors have already determined if their group health plan(s) offer minimum essential coverage; however, considering the increased penalty amounts, it may be advantageous to confirm that aspect of plan design as well."

OBBBA Changes to Employee Benefits: Action Items for Plan Sponsors

"[P]lan sponsors should consider whether offering first dollar coverage for telehealth coverage or a DPC Arrangement meets their organization's employee benefits strategies. Plan sponsors that want to offer loan assistance through their qualified education assistance plan will need to amend their plan ... Plan sponsors may always want to evaluate how the increased [DCAP] limit may impact nondiscrimination testing."

HDHP Deductible Waiver for Telehealth Services Ends December 31, 2024

"The HDHP deductible waiver and corresponding HSA safe harbor originated as part of a broad range of measures enacted in the [CARES Act] ... The waiver was further extended in subsequent legislation ... Now, without a further extension of the HSA exception, meeting the deductible will be required for HDHP members to remain eligible to make HSA contributions or to receive their employers' HSA contributions."

Required Retirement Plan Amendments for 2024 and Beyond

"Any required amendments provided in the 2024 RA List will need to be adopted by December 31, 2026, which is the last day of the remedial amendment period.... [No] required amendments are listed for which December 31, 2026 would be the deadline for adoption. Part B includes changes in requirements that will not require amendments to most plans but may require an amendment because a particular plan contains the affected provisions. The 2024 RA List describes two such potential amendments."

MHPAEA Final Regs Are Here: What You Need to Know

"Plans that are not fully insured and covered by MHPAEA should consult with their [TPA] ... to collect and analyze the data needed to comply with the MHPAEA final regulations and the required NQTL comparative analyses.... [P]lan sponsors that have a separate prescription drug benefit administered by a [PBM] should confirm that the PBM or another service provider is completing the comparative analyses in connection with the drug benefits."

IRS Allows Employee Choice to Allocate an Employer Contribution Among Multiple Benefit Programs

"[The IRS] approved an employee benefits program design (outside of a cafeteria plan) that would offer employees flexibility in allocating an employer contribution among certain employer-sponsored benefit plans.... Employer Considerations: [1] When to implement.... [2] Educational assistance program limit.... [3] Administrative complexity.... [4] Nondiscrimination testing.... [5] Program costs."

ACA Affordability Threshold Increase for 2025

"[The ACA] affordability threshold is increased from 8.39% for 2024 to 9.02% for 2025.... The initial [Employer Shared Responsibility] penalty amount of $3,000 (in 2015) is now $4,350 for 2025, a decrease from 2024's annualized penalty of $4,460 per affected employee."

The IRS Answers Many Questions About QSLP Matching Contributions

"To be treated as 'incurred by the employee,' the employee must have a legal obligation to repay the loan under its terms. The Notice explains that a cosigner may have a legal obligation to repay a loan, but a guarantor would not have such an obligation unless the primary borrower defaults.... A plan is not required to have an employee submit verification in support of his or her certification that the qualified education loan is a QSLP. However, a plan may establish reasonable procedures that require independent verification that an employee has made payments on a qualified education loan."

IRS Provides Guidance on Plan Distributions for Emergency Personal Expenses and Domestic Abuse Victims

"Both new exceptions [to the additional 10% tax]: [1] are optional ... [2] may be documented by written certifications from the participants, [3] may be drawn from any combination of elective deferrals, matching contributions, or other employer contributions in the participant's account balance, [4] are not considered 'eligible rollover distributions' or subject to the mandatory 20% income tax withholding requirement, and [5] are effective January 1, 2024."