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Health & Welfare Blog

Health Care Reform: Are You A "Large" Employer

[fa icon="calendar'] Feb 2, 2017 7:22:55 AM / by Ken Ruthenberg

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Beginning in 2014, a large employer may be subject to a penalty if the employer does not provide minimum essential health coverage to its full-time employees.

A large employer is one that for a year employed an average of at least 50 full-time employees (at least 30 hours per week) on business days during the preceding calendar year. In order to make this determination, the employer must not only count all of its full-time employees, it must count the hours worked by its part-time employees for each month and divide this total by 120 in order to determine its "full-time equivalent" employees for the month.

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Employee Aggregation Rules: Leased Employees

[fa icon="calendar'] Jun 29, 2015 9:00:00 AM / by Ken Ruthenberg posted in Welfare

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Fourth And Final (Whew!!) Of A Series

In our first three action-packed episodes on the aggregation of employers and employees, we spent a dark and stormy night with the owners of SMALLCO and SMALL Vineyards and their advisors learning about the steamy world of controlled group rules. We introduced Dr. D to the seamy underside of affiliated service groups (and probably ruined his otherwise sunny day). We now turn to our final aggregation rule: the leased employee rule, which treats each employee who qualifies as a "leased employee" as if he were employed by someone other than his true employer.

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Employee Aggregation Rules: Affiliated Service Groups

[fa icon="calendar'] Jun 29, 2015 9:00:00 AM / by Ken Ruthenberg posted in Welfare

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Third In A Series

In the first two installments of this series on the aggregation of employers and employees, we spent a dark and stormy night with the owners of SMALLCO and SMALL Vineyards and their advisors learning about the controlled group rules and why the employees of the two businesses had to be considered employed by one employer for employee benefit plan purposes. This prompted one of the owners of the winery (whose identity is disclosed only as "D") to wonder if his dental practice has any such problems. We now welcome Dr. D to the wonderful world of affiliated service groups (ASGs).

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Employee Aggregation Rules: Controlled Groups

[fa icon="calendar'] Jun 29, 2015 9:00:00 AM / by Ken Ruthenberg posted in Welfare

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Second In A Series

In our last episode we left our heroes spending a dark and stormy night arguing about who screwed up and failed to recognize that SMALLCO and SMALL Vineyards had to be considered one employer for employee benefit plan purposes.

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Employee Aggregation Rules: What You Don't Know Can Hurt You

[fa icon="calendar'] Jun 29, 2015 8:59:00 AM / by Ken Ruthenberg posted in Welfare

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First In A Series

It was not a dark and stormy night--at least it didn't start out that way. Instead, it was a sunny and calm afternoon, and a routine year-end review meeting was taking place between the owners of SMALLCO (a manufacturing business), their accountant and their retirement plan third party administrator (TPA). And then it happened. The accountant made a remark to the business owners about their other business, SMALL Vineyards (a small winery), and the TPA asked, with great surprise in her voice, "What winery?" 

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Affordable Care Act Compliance: The DOL Is Auditing

[fa icon="calendar'] Jun 26, 2015 9:00:00 AM / by Wendy Gilligan posted in Welfare

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The Department of Labor (DOL) appears to be focusing its scrutiny on welfare benefit plans in response to the Patient Protection and Affordable Care Act of 2010 (PPACA). Now that Obamacare implementation is well underway, practitioners have begun seeing a shift in the audit letters that plans typically receive as their first notice that a plan is being audited. The change in the scope of information requested in these audit letters suggests that the DOL is actively seeking out plans that don't comply with PPACA.

Generally, the DOL's first step in the audit process is to send an audit letter from its enforcement arm – the Employee Benefits Security Administration (EBSA). The letter details a list of "plan-related materials" the plan must produce within 10 days of the letter's receipt. It includes questions specifically designed to determine whether a plan is in compliance with PPACA. For example plans are being asked to produce documentation of:

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Don't Pick Up COBRA As Part of Your Next Deal

[fa icon="calendar'] Jun 26, 2015 9:00:00 AM / by Ken Ruthenberg

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Recently, we have received a number of questions from business lawyers and their clients regarding the responsibilities of the parties in an acquisition transaction (i.e., a stock sale or an asset sale) under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). As you probably know, COBRA requires many group health plans to offer to current participants and their beneficiaries the ability to continue coverage under the plan after certain qualifying events occur that would otherwise result in the termination of an individual's coverage. Here is an overview of how the COBRA rules work in an acquisition.

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Form 5500: Are You Sure You Are Filing All That Are Required?

[fa icon="calendar'] Jun 26, 2015 9:00:00 AM / by Ken Ruthenberg

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Advice on how and when to file Form 5500…

How can filing an annual return/report on a Form 5500, a relatively simple information return that does not require the payment of any taxes, become so complicated and result in such huge penalties for noncompliance? The answer lies in the complex filing requirements that mandate employee benefit plan filings by employers with the IRS, the DOL, or both.

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Cafeteria Plans: Are You Serving "Taxic" Waste To Your Employees?

[fa icon="calendar'] Jul 5, 1994 10:00:00 AM / by Ken Ruthenberg

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Employers may be very surprised to discover that they have a cafeteria plan and do not even know it, or that they have a cafeteria plan that improperly offers certain benefits to their employees. As a result, they are serving their employees "taxic" waste, i.e., tax heartburn, rather than the "low-tax" cuisine they could be offering through the cafeteria plan's menu.

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