The Benefit of Benefits

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On July 16, 2021, the IRS released its updated Employee Plans Compliance Resolution System (EPCRS) by issuing Rev. Proc. 2021-30 setting forth the parameters of the program and replacing the former governing revenue procedure, Rev. Proc.  2019-19.  EPCRS is a comprehensive system under which employers can save the favorable tax treatment of retirement plans intended to be qualified retirement plans under Internal Revenue Code (Code) section 401(a), 403(b) plans, or SEP and SIMPLE IRAs when they have failed to meet the requirements of the Code either in operation or in their plan document.  Changes to EPCRS include: expansion of the…
On June 17, the U.S. Supreme Court finally decided California v. Texas, the case challenging the constitutionality of the Affordable Care Act (ACA) after the penalty for not complying with the individual health insurance mandate was reduced to zero in the 2017 Tax Act.  Many believed the case would center around whether the rest of the ACA could be severed from the individual mandate if the Court found the mandate unconstitutional.  See, Could Severalbility Be The Treat That Foils Senate Republican’s ACA Supreme Court Trick? However, the Justices did not even reach that issue because they found in a 7-2…
On May 6, 2021, the United States Court of Appeals for the Ninth Circuit upheld a District court’s dismissal of a complaint filed by the Howard Jarvis Taxpayer’s Association (HJTA), challenging California’s state mandated IRA program, CalSavers, as being preempted by ERISA. CalSavers is California’s mandated auto-enrollment payroll deduction IRA program that requires employers of a certain size, that don’t provide their employees with a retirement plan, to automatically withhold contributions from such employee’s pay and pay them into IRAs managed by CalSavers.  However, employees can opt out.  ERISA is a federal law that preempts any state law that “relates…
Under the federal health coverage continuation law, known as COBRA, a private employer with 20 or more employees that sponsors a group health plan must let individuals elect to continue their health coverage when it would otherwise end for certain reasons (such as job loss, divorce or the employee’s death). Qualified beneficiaries with COBRA continuation rights include employees, spouses and dependents who would lose coverage because of the event. Employers can charge individuals electing COBRA the full cost of coverage, plus an additional 2% to cover administrative costs. Individuals who lose employer coverage because of job loss (voluntary or involuntary)…
I just published, on March 1, my article “New President, New Hope, New ESG Policy. . . Maybe.”  discussing how the Biden administration would be reviewing the Department of Labor regulations finalized on November 13, 2020 (under the Trump administration) and effective January 12, 2021, regarding the investment duties of fiduciaries under ERISA plans and the factors to consider when making decisions.  The article discussed how the Biden administration would be reviewing the new rules and changes are likely but changing a final regulation could take a year or more.  Now on March 10, the Department of Labor…
A lot has happened in 2021 already.  The election of Joe Biden as President was certified by the Senate after an unprecedented attack on the Capitol on January 6.  The House of Representatives impeached former President Donald Trump one week later.  Biden was inaugurated on January 20 at a heavily secured ceremony. The inauguration was the final step in the most contentious election in American history.  One where before votes were cast, the incumbent President signaled that if he didn’t win, the election was fraudulent.  A sentiment that he continued after his loss, through dozens of lawsuits challenging results and…
On February 5, 2021, the United States Department of Labor withdrew its amicus brief supporting the Howard Jarvis Taxpayers Association’s (HJTA) appeal of the dismissal of its lawsuit challenging CalSavers as being preempted by ERISA.  See No Fooling HJTA Appeals Dismissal Of CalSavers Preemption Decision.  CalSavers is California’s payroll deduction IRA program requiring employers, who don’t otherwise offer a retirement plan to employees, to automatically deduct amounts from employees’ pay and contribute such amounts to the state-run IRAs.   The notice was filed with the United States Court of Appeals for the Ninth Circuit that is hearing the appeal of…
Happy Holidays!  You may have a pep in your step with the news that the FDA has approved the Pfizer vaccine to combat COVID-19.  This is certainly a reason for optimism.  However, 2021 promises to be quite PEPPY for another reason.  Pooled Employer Plans (or PEPs) can begin operating in 2021.  PEPs are Multiple Employer Plans (or MEPs) that were authorized as part of the SECURE Act enacted in 2019.  See 2020 Appropriations Bill.  They are individual account retirement plans adopted and maintained by more than one employer where the employers need not be related by geography or industry.…
The Republican Senate has confirmed President Trump’s nomination of Amy Coney Barrett to the United States Supreme Court.  The confirmation is record breaking in a couple of ways.  First, it was the fastest confirmation of a Supreme Court Justice in history.  Second, it was the most partisan vote to confirm a Supreme Court Justice as no Senate Democrats voted to confirm.  It was also the first such hearing or confirmation to take place while citizens were voting in a Presidential election.  Democratic Senators protested the appropriateness of the hearings up to the deciding vote, maintaining that the next President should…
Our country lost a great lawyer, jurist, advocate, patriot, citizen, and icon on Friday.  And oh yeah, she happened to be a woman.  Of course, I’m talking about Supreme Court Justice Ruth Bader Ginsburg, the notorious RBG.  She will be missed on a court that is becoming more and more conservative and political. The debate has already begun as to whether President Trump will be able to get his nominee appointed before the election or before Joe Biden takes office in January, should he win.  This issue is very important to the fate of the Affordable Care Act (ACA) as…