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Cadillac Tax Delayed and Made Deductible

The President recently signed into law H.R. 2029, the Consolidated Appropriations Act, 2016 (the ?Ç£Act?Ç¥). Among the numerous changes made by the Act were significant modifications to the ?Ç£Cadillac Plan Tax,?Ç¥ which is a 40 percent excise tax on any excess benefit provided under a ?Ç£high cost?Ç¥ employer sponsored health plan. First, the implementation of this tax has been delayed by two years so that it will not become effective until tax years beginning after December 31, 2019. Second, the tax payment will now be permitted as a deductible business expense.

The Act is available?áhere.

The lawyers of our Employee Benefits and Executive Compensation Practice Group are readily able to assist companies on a nationwide basis with implementing sophisticated benefit plans and providing answers to their most challenging compensation issues. Additionally, our lawyers are well aware of the daily employee benefits challenges facing companies of all sizes and are capable of helping in-house lawyers and human resources personnel with the day-to-day advice and guidance necessary to properly administer employee benefits plans.

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December 2015
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