Vision Payroll

The Internal Revenue Service (IRS) has released Notice 2009-27, Premium assistance for COBRA benefits. Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a payroll tax credit on their Form 941 to be reimbursed for the assistance provided.

In recently issued guidance, the IRS confirmed that members of military Reserve units and National Guard are considered involuntarily terminated if they are called to active duty. This is true whether the employer treats it as a termination of employment or a leave of absence. Contact Vision Payroll if you have any questions on the COBRA premium reduction credit.

Due to flooding and ice jams in Alaska on April 28, 2009, President Barack Obama declared the following regional educational attendance areas a federal disaster area: Alaska Gateway, Kuspuk, Yukon Flats and Yukon-Koyukuk. Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after April 27, 2009 and before May 14, 2009 as long as the deposits were made by May 13, 2009. Also, affected taxpayers will have until June 29, 2009 to file most tax returns. Contact Vision Payroll if you were affected by the flooding and ice jams and need further information on the relief provided by the IRS.

The Internal Revenue Service (IRS) has released Notice 2009-27, Premium assistance for COBRA benefits. Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a payroll tax credit on their Form 941 to be reimbursed for the assistance provided.

In recently issued guidance, the IRS reviewed elected officials eligibility for the premium subsidy. The important distinction is whether or not the elected official is considered involuntarily terminated. The IRS considered three situations, as follows:

1. An elected official who runs for reelection, but is not reelected is considered involuntarily terminated.
2. An elected official prohibited by term limits from running for reelection is considered involuntarily terminated.
3. An elected official who does not run for reelection, but is eligible to do so, is not considered involuntarily terminated, even if the elected official did not run due to illness.

Contact Vision Payroll if you have any questions on the COBRA premium reduction credit.

This week’s question comes from Mark, a partner in a partnership. I’ve just been made a partner in a partnership. As an employee, I was participating in the company’s Flexible Spending Arrangement (FSA) plan. I’ve been told I can no longer participate. Can a partner participate in an FSA? Answer: FSAs, sometimes called “Flexible Spending Accounts”, are generally setup for reimbursement of medical or dependent care expenses. Partners in a partnership (including LLCs and other similar entities that have elected to be treated as a partnership for tax purposes) are considered self-employed individuals. As such, they are not eligible to participate in an FSA sponsored by the partnership in which they are a partner. Contact Vision Payroll if you have further questions on FSA eligibility.

According to the US Department of Labor, in the week ending June 13, the advance figure for seasonally adjusted initial claims was 608,000, an increase of 3,000 from the previous week’s revised figure of 605,000. The 4-week moving average was 615,750, a decrease of 7,000 from the previous week’s revised average of 622,750.

The advance seasonally adjusted insured unemployment rate was 5.0% for the week ending June 6, a decrease of 0.1 percentage points from the prior week’s unrevised rate of 5.1%.

The advance number for seasonally adjusted insured unemployment during the week ending June 6 was 6,687,000, a decrease of 148,000 from the preceding week’s revised level of 6,835,000. The 4-week moving average was 6,757,500, an increase of 2,250 from the preceding week’s revised average of 6,755,250.

The fiscal year-to-date average for seasonally adjusted insured unemployment for all programs is 5.286 million.

Most employers are familiar with the Worker Adjustment and Retraining Notification (WARN) Act. Because of the minimum employee levels, sporadic enforcement, and relatively mild penalties, many employers have not concerned themselves with it. Do you know what sets state laws in Michigan and Minnesota apart from other states? Do you know which states have recently enacted mini-WARN statutes? Do you know which state bills companies for re-employment assistance?

Learn the answers to these questions and also what you need to know about the Federal Oversight, Reform, and Enforcement of the WARN Act (FOREWARN Act) in this month’s HRCast, a recording provided by our team of HR Pros and available exclusively on MyHRSupportCenter. You’ll learn how the FOREWARN Act will change the definitions of affected employers, minimum layoffs, and the notice period. Also learn about when potential double penalties may be imposed and how the Secretary of Labor’s rôle could change.

Visit MyHRSupportCenter regularly not only for our HRCasts, but also to get late-breaking compliance alerts, best practices to implement, and HR tools to use every day. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

The Internal Revenue Service (IRS) has released Notice 2009-27, Premium assistance for COBRA benefits. Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a credit on their Form 941 to be reimbursed for the assistance provided.

In recently issued guidance, the IRS confirmed that an employee “hired only for a limited period such as a seasonal worker or a teacher hired only for one school year” is considered involuntarily terminated for premium subsidy purposes if the employee works to the end of season or contract period, is not offered employment, and is able and willing to work. Contact Vision Payroll if you have any questions on the COBRA premium reduction credit.

The California Franchise Tax Board (FTB) recently recommended that taxpayers review their withholding due to changes in the state personal income tax laws. Recent changes increased the tax rates by 0.25% and reduced the dependent exemption credit. Tax tables have been amended to reflect the change in tax rates, but only prospectively. They have not been amended to reflect the change in the dependent exemption credits. Therefore, the FTB is recommending taxpayers complete a new California Form DE-4, Employee’s Withholding Allowance Certificate, to adjust their withholding if necessary. Employers who receive a revised Form DE-4 should update their payroll records online or contact Vision Payroll with the updated information.

The Internal Revenue Service (IRS) has released Notice 2009-27, Premium assistance for COBRA benefits. Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a credit on their Form 941 to be reimbursed for the assistance provided.

In recently issued guidance, the IRS stated that if an insurer is providing continuation coverage under a comparable state law, the coverage still qualifies for premium subsidy even if the group health plan has terminated after the employer has gone out of business. Contact Vision Payroll if you have any questions on the COBRA premium reduction credit.

The Internal Revenue Service (IRS) has released Notice 2009-27, Premium assistance for COBRA benefits. Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a credit on their Form 941 to be reimbursed for the assistance provided.

In recently issued guidance, the IRS stated that when an employer voluntarily provides continuation coverage when the plan is not subject to “COBRA continuation coverage”, then the subsidy does not apply to the voluntary coverage. Contact Vision Payroll if you have any questions on the COBRA premium reduction credit.