Good news! With Rev. Proc. 2019-44 the IRS has announced the annual inflation adjustments for 2020, which include increased contribution limits for the following benefit accounts:
- Healthcare FSA annual contribution limit: $2,750 (increase of $50)
- Transit Account monthly maximum: $270/month (increase of $5)
- Parking Account monthly maximum: $270/month (increase of $5)
The annual limits for Dependent Care FSA will remain unchanged at $5,000 per year; $2,500 if married filing single.
Keep track of all current IRS limits at www.tasconline.com/benefits-limits.
One of the biggest challenges that small employers face is attracting and retaining employees. Beginning January 1, 2020, employers who have multiple employees can offer an Individual Coverage Health Reimbursement Arrangement (ICHRA) to employees to reimburse individual insurance premiums and out-of-pocket medical expenses. These changes will make it easier for employers to provide valuable benefits. This policy is a result of Executive Order 13813. This order was issued by President Trump in 2017 to expand the availability and use of Health Reimbursement Arrangements (HRAs) and promote healthcare choice and competition.
IRS Notice 2013-54, issued in September 2013, limited the ability of small business owners to utilize stand-alone HRAs (unless they were a One Employee HRA).
In 2016, the Cures Act established the Qualified Small Employer HRA (QSEHRA). This legislation overturned guidance issued in IRS Notice 2013-54 and once again allowed employers with fewer than 50 employees to utilize HRAs as a pre-tax health and welfare benefit. The QSEHRA has many restrictions and requirements that the ICHRA does not. For example, a QSEHRA is only available to employers with fewer than 50 eligible employees and employer contributions are capped. ICHRAs are one of the accounts available on TASC’s new Universal Benefit Account platform. ###
Due to requirements resulting from the Patient Protection and Affordable Care Act (PPACA), employers who offer employer-sponsored benefits are required to file IRS Tax Form 720 and pay a small fee. This will impact Plan years ending 2012-2019. Don’t worry; TASC has your multi-employee AgriPlan, BizPlan and No Limit Plan clients covered!
Fee helps to fund research and consumer-based health decisions
Established by PPACA, the Patient-Centered Outcomes Research Institute (PCORI) is charged with examining the relative health outcomes, clinical effectiveness, and appropriateness of different medical treatments by evaluating existing studies and conducting its own. The Institute will be funded in part by employer-paid fees.
This means your multi-employee AgriPlan, BizPlan, and No Limit Plan clients will have to file an additional tax form and pay a small fee by July 31st each year. The fee total will be $2.26 per Plan Participant.
What do your clients need to do?
TASC is committed to keeping your clients in compliance and backs every Plan with our Audit Guarantee. To help ensure compliance, please ask these clients to watch their mail early-June for a pre-filled IRS Tax Form 720 and instruction from TASC regarding the required PCORI information.
- Completed form with payment should be mailed to the IRS and postmarked no later than July 31, 2018
- Mail to the Department of Treasury, Internal Revenue Services, Cincinnati, OH 45999-0009
If you are already filing IRS Tax Form 720 for your clients, please include the PCORI calculation and fee that was sent to your client.
If you have eligible employees who are entitled to receive payments and reimbursements from the Small Business HRA (also known as a QSEHRA) for the calendar year 2017,, please be aware you must do the following:
- Enter code FF in Box 12a on the employee’s W-2 form (This code was been assigned to represent QSEHRA payments/reimbursements.)
- Enter the maximum PERMITTED benefit. In 2017, this was $4,950 for an individual and $10,000 for a family.
For instance, this is what the W-2 would look like for an employee with individual coverage under the QSEHRA who was reimbursed for $3,500 in benefits.
Complete and distribute your employee W-2 forms by January 31, 2018 and be sure to use the new FF code in box 12 for any QSEHRA eligible employees. For more information, click on the following LINK and see Section J (Reporting Requirement) which starts on page 35 or contact your tax professional.
A new President and Congress continue attempts to repeal the Affordable Care Act (ACA). To date, they have not had success in doing so and therefore the ACA Reporting requirement for Minimum Essential Coverage stands.
Employers who provide health coverage are required to report health Minimum Essential Coverage information to covered employees, former employees and the IRS annually. For Group-insured health plans, this requirement lies with the insurance carrier. For self-insured Plans, this responsibility rests with the employer.
Employers are required to submit a 1094-B Transmittal Form and 1095-B forms for each covered employee to the IRS by February 28th, or March 31st if filing electronically.
In addition, they must distribute IRS Form 1095-B to affected employees by January 31st. Employees will use this form when completing their own individual income tax returns as proof of health insurance coverage for the prior calendar year. Under existing Healthcare Reform rules, an individual can be fined for any month they fail to maintain health coverage.
To help ensure the compliance, TASC will once again email (or mail if TASC doesn’t have an email address on file) its Microbusiness multi-employee No Limit Plan Clients (who don’t sponsor Group insurance) detailed instruction and links to these online fillable tax forms next week.
TASC’s legal, compliance and governmental affairs departments have concluded that Clients who had a QSEHRA Small Business HRA are not required to file or distribute these forms.
TASC’s ACA Reporting service is available to all other Clients for a fee. If interested in learning more, please contact your RSD or call Customer Care at 800.422.4661.
You probably need no reminder; however, it’s time for your Clients to start thinking about tax season! TASC makes it fast and easy for your Clients to get the records they need with MyTASC online tools. These tools let your Clients download their AgriPlan, BizPlan and No Limit Plan Year-End Report as soon as they’ve finished submitting all of their medical expenses for the year—and the earlier they have their Year-End Report in hand, the sooner they can schedule an appointment with you or their tax professional!
We make it fast and easy for your Clients to download their Year-End Report
Here are the instruction we are sending to your Clients:
- Log in to your MyTASC account at http://www.tasconline.com. There’s an instructional video on how to log in to MyTASC on the TASC home page.
- Enter any additional medical expenses that weren’t purchased through your TASC Card. (Expenses paid for with your TASC card are already included.)
- Click on the Create Year-End Report button (found under both My Expenses and the Year-End Report tab in MyTASC).
- We’ll compare your expenses against a list of eligible ones. If your expenses are approved, you’ll be able to immediately create and print your report in PDF format.
- If any of your submitted expenses are in question, your Year-End Report will take another three to five business days for manual review. After this review and approval, you’ll receive an email with a link to log back into MyTASC and you’ll be able to download your report at your convenience.
Do you prefer a paper Transmittal?
If you told us last year that you wanted a Transmittal form mailed, you will receive one in the mail this year and every year thereafter.
If you have not previously request a mailed paper Transmittal form and would prefer this method of reporting your expenses, please complete our Online Form or submit a MyService Request online (log in to MyTASC, click on the Contact Us tab, click on the Service Request link, fill out and submit the form). Please have your TASC ID available. You should receive your paper Transmittal in the mail within 5 to 10 business days. You need only contact us one time in regard to receiving a mailed Transmittal.
Would you like to save time and print a Transmittal worksheet?
If you would like to download and complete a paper Transmittal of your expenses, click on Year-End Report from the MyTASC home page or the Year-End Report tab anytime after December 20th. Then simply click on the Paper Transmittal link to open and print a PDF Transmittal worksheet. Complete the form and mail to TASC.
Thank you for your business!
If you don’t know what a QSEHRA is, you could be missing out on tax savings for your small business owner Clients. In December 2016, The Cures Act and H.R. 34 overturned guidance issued in IRS Notice 2013-54. A Small Business HRA (also known as a QSEHRA) enables qualified small employers with more than one but fewer than 50 employees to once again reimburse individual insurance premiums and out-of-pocket medical expenses. Group insurance is not required. (Integrated and One Employee HRA Plans were already compliant with federal law.)
QSEHRA Small Business HRAs provide a tremendous opportunity to those small employers who do not offer Group health but want to assist their employees with ever-rising healthcare costs. Learn more at http://go.tasconline.com/microQSEHRA