Category: Employee Benefits
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Bad tax advice and gobblygook
It has always been tough for small business owners to get basic straightforward information they need to avoid tax problems. But this year I notice the problem is magnified many times by a flood of misinformation and gobblygook published on blogs and promoted in social media, This is especially true for issues surrounding the Affordable…
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The gap in small business employee benefits advice
Yesterday I had a great telephone conversation with a guy I met on LinkedIn. His business sells a variety of innovative employee health care solutions. I was impressed. The problem is that they focus on groups with 50 or more employees. I explained that my business is driven by incoming inquiries and that these are…
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Avoidable small business taxes in 2015
Small business owners know that some taxes are unavoidable. Taxes are the price we pay to live and work in this society. Yet other taxes are simply the result of sloppy management or failing to keep up with changes in the tax law. It is this latter category of small business taxes that is grabbing most of my attention…
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Don’t believe what you read online, especially about health insurance
This hit me as a shocker today when I Googled the term “taxation of health insurance benefits”. I found that every reference on the first page of the Google listing, excluding the two IRS web site references, either contained errors or the advice was out-of-date and now incorrect. (IRS web pages have been known to contain…
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11 tax traps for small business health plans
The issue starts out innocently enough: a small business employer simply wants to help employees pay for the cost of health care. So the employer voluntary offers to make a payment for that purpose. That’s where the simplicity ends and the tangle of tax laws comes into play. It is far too easy for an employer…
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Retroactive termination of employee benefit plans
Don’t believe everything you read on the Internet! Lately I’ve written that the general rule is that you can not retroactively terminate or amend an employee benefit plan but that under certain circumstances it may be better to do so than not. This is not a topic that lends itself well to a blog post.…
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What options are available to employers who wish to help employees afford the cost of health care?
Provisions of the Affordable Care Act dramatically changed the tax treatment of employer-paid health benefits. Some of the most popular traditional health plans of the recent past now trigger an extremely harsh tax on the employer. Taxes of up to $36,500 per employee per year kicked in on July 1, 2015 for businesses with less than…
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Clear explanation that there are no “1099 employees”
I like this clear simple language in Employee Benefit News: “Employers face an uphill battle in classifying a worker as an independent contractor due to DOL guidance that defines ‘employee’ so broadly that such a classification should only be reserved for a narrow subset of workers.” It is amazing how many employers are oblivious of…
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Most workers are employees
The issue of worker misclassification – where businesses classify workers as independent contractors and local, state and federal authorities call them employees – is a long-standing problem area for small businesses. Federal and state auditors (not just tax but worker’s compensation as well) have been engaged in an aggressive “crackdown” on misclassified workers. This week…
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Tax planning for small business excise tax penalties under IRC 4980D
Tax professionals are looking for the best way to approach clients in this environment of uncertainty surrounding new excise taxes for small business health plans. The excise tax affects two types of plans: 1) those that use individual health insurance, and 2) those that reimburse employee out-of-pocket expenses (often called an “HRA”). Those who say…