Skip to main content

Benefits Buzz - January 2023

 

Benefits Buzz header

IRS finalizes deadline extension for furnishing ACA statements

On Dec. 12, the Internal Revenue Service released a final rule that extends the annual statement furnishing deadlines for reporting under the Affordable Care Act’s Sections 6055 and 6056. This rule finalizes guidance that was proposed by the IRS in December 2021, with minor clarifications. Specifically, the rule:

  • finalizes the 30-day automatic extension to the due date for furnishing statements to individuals under Sections 6055 and 6056; and
  • confirms the availability of an alternate method for furnishing statements to individuals under Section 6055 for every year in which the individual mandate penalty is zero.

The due date for filing forms with the IRS under Sections 6055 and 6056 remains unchanged. This means that forms must generally be filed with the IRS each year by Feb. 28 (or March 31, if filing electronically). Due to the 30-day automatic extension, employers have until March 2 (or March 1 in a leap year) to furnish ACA statements. The deadline for furnishing statements for the 2022 calendar year is March 2, 2023.

Also, because the individual mandate penalty is zero, employers with self-insured plans that are subject to reporting under Section 6055 may use the alternate method of furnishing statements to individuals. With this method, an employer must post a clear and conspicuous notice on its website stating that responsible individuals may receive a copy of their statement upon request. Employers must furnish statements within 30 days of a request. For 2022 statements, this website notice must be posted by March 2, 2023, and must generally remain posted through Oct. 17, 2023.

New for 2023: Health plans must provide price comparison tool

Beginning this year, group health plans and health insurance issuers must make an internet-based price comparison tool available to participants. The purpose of this tool is to provide consumers with real-time estimates of their cost-sharing liability from different providers for covered items and services, including prescription drugs, so they can shop and compare prices before receiving care. Upon request, plans and issuers must also provide this information in paper form or over the telephone.

  • For plan years beginning on or after Jan. 1, 2023, plans and issuers must make price comparison information available for 500 shoppable items, services and drugs.
  • For plan years beginning on or after Jan. 1, 2024, price comparison information must be available for all covered items, services and drugs.

Most employers will rely on their issuers or third-party administrators to provide this tool and provide related disclosures. Employers should confirm that their issuers and TPAs will comply with the price comparison tool requirements beginning with the 2023 plan year and ensure this compliance responsibility is reflected in a written agreement. In addition, self-insured employers should monitor their TPAs’ compliance with this requirement, as the legal responsibility stays with the employer.

The information in this newsletter is intended for informational use only and should not be construed as professional advice. © 2023 Zywave, Inc. All rights reserved.

Popular posts from this blog

COVID-19: Retirement and Benefit Plan Resources

As the COVID-19 crisis continues to unfold, we are closely monitoring news and updates from top sources. We’ll be updating this section as new developments unfold. Here are several key articles and links to help plan sponsors and administrators navigate the COVID-19 impact to retirement and benefit plans: Retirement Plans 4 Key CARES Act Provisions for Retirement Plan Sponsors Markets React to Coronavirus   Important Considerations for Retirement Plan Sponsors during the Coronavirus Pandemic In Fed We Trust Participant Education Services: Timely Help from a Safe Distance CRDs 100% Taxable for New York State and Local Income Tax Purposes in 2020 IRS Permits Remote Notarization of Participant Elections   Employee Benefits CARES Act Expands Health Coverage Rules Understanding the Historic $2 Trillion Stimulus Package Employee Compensation and Benefits During Closures and Furloughs DOL Clarifies Exemptions to Coronavirus Paid Leave Laws Small Business Exemption to

Coronavirus-related distributions 100% taxable for New York state and local income tax purposes in 2020

The Coronavirus Aid, Relief and Economic Security (CARES) Act was signed into law on March 27. Under the Act, participants affected by the coronavirus may be able to take distributions in 2020 of up to $100,000 from an employer-sponsored retirement plan or an IRA. Although allowing these distributions from a qualified retirement plan is optional, we have seen that a number of employers have chosen to amend their plans to permit such distributions. The Act provides that coronavirus-related distributions will not be subject to the mandatory 20% withholding nor the 10% early withdrawal penalty (for those younger than 59½) that would otherwise apply.

ESG retirement investment gets boost from DOL: What plan sponsors should consider

Plan sponsors considering environmental, social and governance (ESG) factors in their investments received promising news with the U.S. Department of Labor’s (DOL) latest update in November. Although ESG investing has received increased attention over the past few years, DOL has not been transparent in defining how qualified retirement programs should incorporate ESG-specific metrics into their selection process. Until recently, the prevailing tone of DOL’s messaging has been that ESG should be secondary to financial factors. The Biden administration had hinted at loosening restrictions on ESG investing that were implemented during the final days of the Trump administration and forgone enforcement of those restrictions in the interim. This latest development is a realization of those earlier signals. With the announcement of DOL’s new rule, plan sponsors can, but are not required to, include ESG factors in their investment searches. Notably, plan sponsors can include ESG factors in th