Greetings from the BBT Alert Desk, the IRS on Wednesday, Feb. 18, issued a new ruling regarding the Affordable Care Act.
- Here are the highlights of that ruling, which were approved by BBT's legal counsel --
Employers can reimburse health insurance premiums pre-tax through June 30, 2015.
- Employers don't have to file IRS Form 8928, even if they did have violations in 2014.
- By June 30, 2015, employers must stop paying for or reimbursing individual health insurance unless they have just one employee. After that date, ACA penalties will be incurred.
- If employers have only one employee, they can continue reimbursing healthcare premiums on a pre-tax basis.
- Employers who have more than one employee and are not in a bona fide group plan, but want to continue to help pay insurance costs, need to change the way this is done after June 30, 2015, to avoid penalties. The way to do this is to increase salaries to cover the health care premiums without stipulating the salary increase for that use.
- Employers should consider amending their 2014 payroll reports and W-2s to treat the premiums as non-taxable.
A printed copy of this BBT Alert is being mailed, but future alerts will go out via email only. As we have done in the past, we will make sure all the District Executives receive our alerts. We also forward our alerts to Mary Jo Flory-Steury at Church of the Brethren Inc., who sends this out through her distribution list, and we submit BBT alerts to Newsline as well.
A word from the president --
Dear Brothers and Sisters in Christ,
I want you to know of a new perspective that BBT is taking with regard to our relationship with you.
Annual Conference has long asked us to provide financially based employee benefits and asset management services. But it also has asked us to provide education and resources to help those within the Church of the Brethren be knowledgeable stewards of their financial resources.
"You have to help us. You know this better than we do."
As I was preparing to present an insight session at a district conference last fall, a group of pastors entered the room and approached me, wanting to talk. The topic was the Affordable Care Act and the uncertainty of the changes and the lack of clarity on what it all means to pastors, church staff members, congregations, districts, and camp staffs -- all who fit under the church plan designation.
"What are the provisions of the law?" "What do they mean?" "How will the ACA impact our budgets?" "What is or isn't taxable?" "What documentation should we, or shouldn't we, have?"
And then the topic turned to me and BBT -- "You have to help us. You know this better than we do." It was clear I was being asked to relay information we receive in order to help pastors and church employees navigate through the myriad changes that are coming as a result of the ACA."
I returned to the BBT offices with the resolve that we should do what we can to help you and others within the denomination keep on top of the legislation that impacts all who fall under the church plan designation. As members of the Church Benefits Association, and as the Church of the Brethren's member on the Church Alliance, a lobbying group of mainline denominations, we often are in the loop of current or proposed changes. It makes perfect sense that we should be as proactive as possible in distributing pertinent news throughout the denomination.
What we can ... and can't ... do
Our commitment is to try to make sure we relay information to you. We are not attorneys nor CPAs, and so while we can talk and counsel within the framework of the benefits we provide, we cannot give advice on topics such as the ACA. Our role is not to give answers, but rather to enable you to ask the right questions of your own legal or tax advisers.
Again, our role is not to answer legal and accounting questions. We are not certified to do so. But we can help you know which questions to ask of your own legal and accounting adviser.
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We are and will remain committed to trying to relay news and information to you in a timely manner so that you are informed and not surprised by changes that could adversely impact you, colleagues, and perhaps your church, district, or camp.