Updated limits for deferred compensation and certain welfare plans.
The IRS has updated some important limits related to employee benefits. Click here to read more and see the table of benefits.
Department of Labor further delays implementation of the fiduciary rule.
The DOL has finalized new regulations that significantly delay the full implementation of its new fiduciary rule. The fiduciary rule went into effect on June 9, 2017, and includes a transition period to phase in some of the rule’s effects. Under the new final regulations, this transition period – originally scheduled to end on January 1, 2018 – will instead end 18 months later, on July 1, 2019. The delay affects the Best Interest Contract Exemption (“BIC Exemption”), the Principal Transactions Exemption and certain amendments to the Prohibited Transaction Exemption 84-24. (You can read about the delayed rules here.)
Final disability claims regulations delayed 90 days.
The Department of Labor is putting a 90-day hold on the applicability date of the new claims procedures for ERISA plans, through April 1, 2018. This delay affects the final regulations that were published on December 19, 2016, which required plans to, among other things, provide claimants an opportunity to review and respond to any new information or rationales before a final decision is made and to expand on the information provided to claimants. The delay means the DOL may be considering revising – or perhaps even revoking – the new regulations.
You can read the announcement here.
ACA tax updates: the IRS is preparing to enforce employer shared-responsibility penalties.
Check out this newly-updated IRS Q&A– questions 55 through 58 – and this form IRS letter. By the end of 2017, the IRS plans to send out letters to employers who may owe 2015 “pay or play” penalties. The letter (what the IRS is labeling “letter 226J”) will indicate the assessment amount the IRS proposes, and will include a list of any employees who qualified for a tax credit on the ACA exchange and who did not receive an offer of “affordable” coverage, month by month. Employers will generally have 30 days to respond. If you receive this letter, get in touch with your benefits counsel immediately! If you do not timely respond to the letter, the IRS will assess the penalty and issue a demand for payment.