IRS Regulations Expand Requirement to File Electronically

Wendy Lopez

Final regulations issued by the Internal Revenue Service (“IRS”) expand the requirement to electronically file certain returns and other documents with the IRS. This new requirement will impact employers who file Forms 1094-C, 1095-C, 1094-B and 1095-B. It will take effect for returns due to be filed on or after January 1, 2024. Please note that the information provided in the document is of a general nature and is not intended to interpret laws or regulations or address specific client situations. Employers are advised to seek advice from an attorney or tax professional before taking any action based on the information in the document. For more information and to read… Read More

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Small Group – Form 1095-B: Who receives it and why

Ed MacConnell

Form 1095-B is a health insurance tax form used to report certain information to the IRS and taxpayers about individuals who are covered by Minimum Essential Coverage (MEC). What are the IRS reporting requirements? The ACA requires individuals to obtain and report that they had MEC or otherwise qualify for an exemption from the requirement. However, there is no longer an individual tax penalty following the 2017 Tax Cuts and Jobs Act. Individuals may need Form 1095-B to demonstrate MEC for nontax-related purposes. The ACA also requires certain employers to offer all full-time employees and their dependents MEC to meet affordability and minimum value standards. This is known as the… Read More

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IRS Health Savings Account Adjusted Amounts for 2023

Ed MacConnell

The IRS has released the 2023 cost-of-living adjustments for Health Savings Account (HSA) contribution limits, HDHP deductibles, and out-of-pocket maximums. To read the official IRS release, click here. As always, please contact your Total Benefit Solutions health insurance specialists at (215)355-2121.

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IRS Announces 2023 ACA Affordability Indexed Amount

Ed MacConnell

The IRS recently announced in Revenue Procedure 2022-34 that the Affordable Care Act (“ACA”) affordability indexed amount under the Employer Shared Responsibility Payment (“ESRP”) requirements will be 9.12% for plan years that begin in 2023. This is a notable decrease from the 2022 percentage amount (9.61%) and below the original 9.5% threshold. Rev. Proc. 2022-34 establishes the indexed “required contribution percentage” used to determine whether an individual is eligible for “affordable” employer-sponsored health coverage under Section 36B (related to qualification for premium tax credits when buying ACA Marketplace coverage). However, the IRS explained in IRS Notice 2015-87 that a percentage change under Section 36B will correspond to a similar change… Read More

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What is a High Deductible Health Plan (HDHP)?

Ed MacConnell

A plan with a higher deductible than a traditional insurance plan. The monthly premium is usually lower, but you pay more health care costs yourself before the insurance company starts to pay its share (your deductible). A high deductible plan (HDHP) can be combined with a health savings account (HSA), allowing you to pay for certain medical expenses with money free from federal taxes. For 2022, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family. An HDHP’s total yearly out-of-pocket expenses (including deductibles, copayments, and coinsurance) can’t be more than $7,050 for an… Read More

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Affordability of Health Coverage

Ed MacConnell

Applicable Large Employers, those with 50 or more full-time employees in the prior year, must offer their full-time employees minimum essential coverage providing minimum value that is affordable. A plan is affordable if the premium for self-only coverage does not exceed a certain percentage of the employee’s household income. The IRS sets the percentage each year. The baseline percentage was 9.5%. In 2022, the affordability percentage is 9.61%. In 2021, it was 9.83%. A plan will be considered affordable if its premium for the lowest cost, single-only plan does not exceed the identified percentage of an employee’s household income. Since household income is not readily available, employers use one of… Read More

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IRS Announces Medical Mileage Rate Increase

Ed MacConnell

To offset high gas prices, on June 9, 2022, the Internal Revenue Service (IRS) announced an increase in the 2022 standard medical mileage rate for the final six months of 2022. Effective July 1, 2022, the new rate for when an automobile is used to obtain medical care is 22 cents per mile for the remainder of 2022, which is an increase from the rate of 18 cents per mile effective January 1 – June 30, 2022. Mileage to and from a medical service is generally an eligible expense under a Healthcare Flexible Spending Account, Health Reimbursement Arrangement, or Health Savings Account. Click here to learn more. As always, please… Read More

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