IRS Compliance Update – Notice 2015-87

On December 16th, the Treasury Department and IRS released Notice 2015-87 regarding the treatment of employer health care arrangements and the market reforms of the Affordable Care Act.  Below are a few highlights from the most recent Notice 2015-87: 

1) The notice reaffirms that an HRA or employer payment plan with one participant can still reimburse individual market premiums without violating the market reforms.

2) The notice solidifies that an HRA or employer payment plan with two or more participants cannot pay or reimburse individual market premiums.  These types of arrangements are subject to the $100 per-employee per-day penalty.

3) The notice amended previous guidance regarding Integrated HRAs.  Prior to this notice, the benefit amount of the Integrated HRA could be extended to a spouse and dependent who were not insured by the employer’s group insured plan, but insured by another employer’s group insurance plan.  From this point moving forward the Integrated HRA benefit amount can only be extended to individuals who are insured by the employer’s group insurance plan.  

4) The notice reiterates that an employer who utilizes an Excepted Benefits HRA or 125 Plan for two or more participants does not violate the market reforms.

5) The notice further confirms that an employer cannot utilize a Section 125 plan to pretax individual market premiums, even if it is funded solely by the employee.  These types of arrangements are subject to the $100 per-employee per-day penalty.

Many of the questions addressed elaborate on IRS Notice 2013-54, FAQs about the Affordable Care Act Implementation (Part XXII), Notice 2015-17, and final regulations implementing the market reform provisions of the ACA, which BASE® has already complied with, leaving our customers effectively untouched by this notice.  While BASE® plans have been operating under this interpretation already, you may have customers who are not utilizing BASE®, either self-administering or using another administrator, and will want to consider completing a compliance assessment.


Anne Case

BASE® - Director of Marketing & Communications  


Be the Difference For Your Client

Section 105 allows you to be the “Go To” for your self-employed client

It is open enrollment season and we find that we are speaking with more and more health insurance agents lately. In a field with a lot of competition, how do you stand out?  What can you offer your clients that other agents may not know about? Allow BASE® to help you create Section 105 BASE® HRA plans for your clients.  Assist farmers and other small business owners by allowing them to deduct up to 100% of their family’s qualifying medical expenses as a legitimate business deduction. 

This plan saves your client an average of $4,500 a year on taxes.  Also, this plan is low maintenance. This well received plan takes an average of 12 hours per year to keep updated and current. 

BASE® assists you in creating this money saving plan every step of the way. We provide legal plan documents, which are required by the IRS, DOL & ERISA, third party adjudication and stellar customer service. When you call, we answer.

Using BASE® has been a success for many agents.  Iowa Insurance agent, Beau Jorgensen, recalls using BASE®. “I used BASE® with a client and it turned out great,” he said.  The client is a sole proprietor farmer and his wife helps out on the farm an average of 30 hours per week. The couple had $1650 in health insurance premiums and averaged $8,000 per year in out of pocket expenses. By establishing an HRA they were able to deduct the qualifying health expenses and had $9,000 in tax savings.

Another agent, Linda Gosch from South Dakota, has come to realize the Section 105 HRA helps more than just farmers. “Initially I was only interested in BASE® for the farmers I work with, and now look back and think if I would’ve only spent the couple hundred dollars on a BASE® plan myself. That small fee would have been worth it to have $2,400 back in my pocket,” she says.

No matter what type of client, providing a Section 105 HRA to save thousands in tax dollars can make a huge difference in their lives.  Be the difference and show how small actions can lead to big outcomes.

Give your client the opportunity to save money in an easy way– Partner with BASE®!  To learn more about the BASE® HRA and who qualifies, call 1-888-386-9680 or contact BASE® today!

 

Emily Greiner

Marketing/Communications Specialist 

Think of the Future--What Will Your Business Look Like in 30 Years?

With the hype of “Back to the Future” on October, 20, 2015, it had me thinking of my future.  What I do today will make a difference in how tomorrow will turn out. What I save today will help thirty years down the road. However, unlike Marty McFly, we cannot jump 30 years ahead. We cannot foresee problems that may arise or changes that may happen.

With all the uncertainties, let BASE® help you protect your business’ future.  Small changes can make a huge difference in the money you save and what you can do to help your employees.  Opportunities such as the BASE® HRA plan and a BASE® Cafeteria Plan, allow unique ways to save. . And when it comes to compliance, BASE products, such as the ERISA wrap, give you peace of mind and the correct documents to insure you are up-to-date and fulfilling federal requirements.  You may not have a time machine, but with BASE® on your side, you don’t need one.

Save now, worry less and look forward to your future.  Learn more at www.BASEonline.com or call 1-888-227-3105.


Emily Greiner

BASE® -Marketing and Communications Specialist