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IRS Announces Final Regulations Implementing New Hardship Distribution Requirements

The IRS recently published final regulations addressing changes enacted by the Tax Cuts and Jobs Act of 2017, the Bipartisan Budget Act of 2018, and other prior changes to the tax code. The final regulations do not contain any substantive differences to the proposed regulations issued by the IRS in November 2018. The new final regulations: • Permit, but do not require, hardship distributions from a participant’s elective contributions, QNECs, QMACs (including safe harbor matching contributions), and any earnings on those amounts, regardless of when they were contributed or earned. • Prohibit plans from containing a requirement that a participant may not contribute to the plan for any period of time following a hardship distribution (in other words, eliminate the six-month suspension rule). • Eliminate the requirement that a participant take out all available plan loans before receiving a hardship distribution (although plans may continue to contain such a requirement).… Continue Reading

OCR Issues Fact Sheet on Direct Liability for Business Associates under HIPAA

HHS’s Office for Civil Rights(“OCR”), which is the government agency responsible for enforcement of the HIPAA privacy, security, breach notification, and enforcement rules (the “HIPAA Rules”), recently issued a new fact sheet (“Fact Sheet”). The Fact Sheet recaps the provisions in the HIPAA Rules for which a HIPAA business associate may be held directly liable for compliance. HIPAA business associates of an employer-sponsored group health plan, which is a “covered entity” under HIPAA, would include, for example, the health plan’s third-party claims administrator, a health plan consulting firm, a benefits broker, and the health plan’s outside legal counsel, if such persons or entities create, receive, maintain, or transmit HIPAA protected health information (“PHI”) on behalf of the health plan. The Fact Sheet clarified that OCR has authority to take enforcement action against business associates only for certain requirements and prohibitions of the HIPAA Rules as listed in the Fact Sheet,… Continue Reading

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