[firm] blog logo

HRAs May Cause Retirees to be Ineligible for Exchange Subsidies

The IRS has clarified that a retiree covered by a standalone health reimbursement arrangement (?Ç£HRA?Ç¥) will not be eligible for a premium tax credit under the Affordable Care Act to purchase coverage through an exchange.?á The HRA would constitute ?Ç£minimum essential coverage?Ç¥ for any month in which there is an available amount in the HRA, even after the employer has stopped contributing to the HRA. IRS Notice 2013-54 can be found here.

Employers Unable to Pay for Individual Policies on a Pre-Tax Basis

New guidance from the IRS suggests that the only way for employers to pay for employees?ÇÖ individual health insurance policies is to pay for such coverage on an after-tax basis. ?áHealth reimbursement arrangements and employer arrangements that pay or reimburse premiums on a pre-tax basis, which cover individuals who are not enrolled in group health plans, are no longer permissible under the Affordable Care Act.?á Employers may forward post-tax employee deductions to a health insurance issuer without establishing a group health plan. IRS Notice 2013-54 can be found here.

September 2013
S M T W T F S
1234567
891011121314
15161718192021
22232425262728
2930  

Archives