Happy New Year from California. As a reminder, starting January 1, 2024, changes to California’s state disability insurance (SDI) program will effectively increase taxes for employees working in California by 1.1% on income over $153,164. This is the result of both the elimination of the taxable wage limit (which was $153,164 in 2023) and an increase in the California SDI rate, from 0.9% in 2023, such that SDI will apply on all wages at a…
The American Rescue Plan Act of 2021 (the “ARPA”), was signed into law on March 11, 2021, and creates a temporary COBRA premium subsidy for certain qualifying individuals. This COBRA premium subsidy applies to all group health plans subject to the Employee Retirement Income Security Act of 1974. Thus, most employers will be impacted by the new COBRA subsidy. Employers will need to evaluate the impact of the ARPA not only with respect to COBRA…
As part of the tax reform process, Congress proposed several changes to qualified retirement plans that were cut from the final bill. One of these proposals, making changes to the rules governing 401(k) hardship distributions, found a new home in the Bipartisan Budget Act of 2018, signed by the President on February 9, 2018 (the “Act”). The Act also made qualified retirement plan changes which provide additional relief to employees impacted by the California wildfires…
In a recent blog post we discussed the new disability claims procedure rules scheduled to go into effect on January 1, 2018. Earlier this year, as part of the administration’s direction to evaluate existing regulations to make them less burdensome, the Department of Labor (DOL) opened a comment period (through December 11, 2017) on whether the new disability claims procedure rule should be modified, rescinded or retained and raised the possibility of a delay. Based on the…
The IRS, DOL and PBGC recently provided various forms of relief intended to help employees and employers impacted by Hurricanes Harvey and Hurricane Irma. In this second blog post we review funding and reporting relief and take a brief look at Vacation/PTO donation programs. To read our first post on loans and hardship distributions from qualified plans, click here. Defined-Benefit Plan Funding Relief IRS Notice 2017-49 provides single defined-benefit plan sponsors or employers covering more…
The IRS, DOL and PBGC recently provided various forms of relief intended to help employees and employers impacted by Hurricanes Harvey and Hurricane Irma. Due to the extent of the relief provided we are covering this information in two blog posts – the first of which will focus on loans and hardship distributions from qualified plans and the second of which will look at the various reporting and funding extensions available. Plan Loans and Hardship…
Last year the Department of Labor (DOL) finalized new disability claims procedure rules, effective January 1, 2018, to add more procedural safeguards and provide claimants access to more information. Covered Plans The new rules are not limited to disability plans. They apply to all ERISA welfare and pension plans that provide benefits based on a finding of disability (e.g., vesting or payment under pension, 401(k), and top hat plans or life insurance plans that require…