2017 HSA and Health FSA Contribution Limits Announced
The Internal Revenue Service (IRS) has announced the inflation-adjusted contribution limits for health savings accounts (HSAs) and health flexible spending arrangements (health FSAs) for tax year 2017.
2017 Contribution Limits
The tax year 2017 contribution limits for HSAs and health FSAs are as follows:
- HSAs: The annual limitation on deductions for an individual with self-only coverage under a high deductible health plan (HDHP) is $3,400 (up from $3,350 for 2016). The annual limitation on HSA deductions for an individual with family coverage under an HDHP is $6,750 (unchanged from 2016). For 2017, an HDHP is defined as a health plan with an annual deductible that is not less than $1,300 for self-only coverage or $2,600 for family coverage (unchanged from 2016), and annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) that do not exceed $6,550 for self-only coverage or $13,100 for family coverage (unchanged from 2016).
- Health FSAs: The annual dollar limitation on employee contributions to employer-sponsored health FSAs rises to $2,600 (up from $2,550 for 2016).
2016 ACA Transitional Reinsurance Program Contributions Form Due by November 15
Employers sponsoring certain self-insured plans that use a third-party administrator in connection with claims processing, claims adjudication, and enrollment functions (“contributing entities”) must submit their 2016 Annual Enrollment and Contributions Submission Form and schedule a payment for the 2016 benefit year no later than November 15.
Reinsurance Contribution Process
To successfully complete the reinsurance contribution process, contributing entities (or third-party administrators or administrative services-only contractors on their behalf) must register on Pay.gov (or confirm a password if such entities registered for the previous benefit years of the program) and submit their annual enrollment counts of the number of covered lives of reinsurance contribution enrollees for the 2016 benefit year using the 2016 form.
2016 Contribution Amounts
The 2016 reinsurance contribution rate is $27.00 per covered life. For the 2016 benefit year, contributing entities have the option to pay:
- The entire 2016 benefit year contribution in one payment, no later than January 17, 2017 reflecting $27.00 per covered life; or
- In two separate payments for the 2016 benefit year, with the first remittance due by January 17, 2017 reflecting $21.60 per covered life, and the second remittance due by November 15, 2017 reflecting $5.40 per covered life.
IRS Releases Final 2016 Forms 1094 and 1095
The Internal Revenue Service (IRS) has released the final forms and instructions for Forms 1094 and 1095 for calendar year 2016 reporting. Employers are required to report in early 2017 for calendar year 2016.
2016 Forms and Instructions
The following calendar year 2016 reporting forms and instructions are now available:
- Form 1094-C (transmittal)
- Form 1095-C
- Form 1094-B (transmittal)
- Form 1095-B
Information Reporting Deadlines
Applicable large employers (ALEs)–generally those with 50 or more full-time employees, including full-time equivalents (FTEs)–must furnish a Form 1095-C to each of its full-time employees by January 31, 2017. Forms 1094-C and 1095-C are also required to be filed with the IRS by February 28, 2017 (or March 31, 2017, if filing electronically).
Insurers, self-insuring employers, and other parties that provide minimum essential health coverage (regardless of size, except for large self-insuring employers) must furnish a copy of Form 1095-B to the person identified as the “responsible individual” by January 31, 2017. The responsible individual is the person who, based on a relationship to the covered individual(s), the primary name on the coverage, or some other circumstances, should receive the statement. Forms 1094-B and 1095-B are also required to be filed with the IRS by February 28, 2017 (or March 31, 2017, if filing electronically).
Employers subject to both reporting provisions (generally self-insured employers with 50 or more full-time employees, including FTEs) will satisfy their reporting obligations using Forms 1094-C and 1095-C.
In addition, please be advised that Forms 1095-B and 1095-C must be electronically filed if the reporting entity is required to file at least 250 of the specific form.
New Federal Overtime Rule Effective December 1
Effective December 1, a new rule updates the regulations governing which executive, administrative, professional, and highly compensated employees are entitled to the minimum wage and overtime pay protections of the federal Fair Labor Standards Act (FLSA).
Current Rules
The current federal rules provide an exemption from both the minimum wage and overtime pay requirements of the FLSA for bona fide executive, administrative, and professional employees who meet certain tests regarding their job duties and who are paid on a salary basis at not less than $455 per week ($23,660 per year). “Highly compensated employees” (HCEs) who are paid total annual compensation of $100,000 or more and meet certain other conditions are also deemed exempt.
New Rule
The new rule updates the salary and compensation levels needed for executive, administrative, professional, and highly compensated employees to be exempt. In particular, the final rule:
- Raises the salary threshold from $455 a week to $913 per week (or $47,476 annually) for a full-year worker;
- Increases the HCE total annual compensation level to $134,004 annually;
- Amends the regulations to allow employers to use nondiscretionary bonuses, incentives, and commissions to satisfy up to 10% of the new standard salary level, so long as employers pay those amounts on a quarterly or more frequent basis; and
- Establishes a mechanism for automatically updating the salary and compensation levels every 3 years, beginning on January 1, 2020.
Note: When both the FLSA and a state law apply, the employee is entitled to the most favorable provisions of each law.
Election Day is November 8th–Are Your Employees Entitled to Voting Leave?
With Election Day quickly approaching, private sector employers should be aware of their obligations under state law to provide voting leave for their employees.
While there is no federal law that requires private sector employers to provide employees with time off from work to vote in a national or state election, numerous states require that private sector employees be provided with either unpaid or paid time off to vote.
The chart below summarizes the general voting leave requirements of all 50 states and the District of Columbia:
Election Day is November 8th–Are Your Employees Entitled to Voting Leave?
With Election Day quickly approaching, private sector employers should be aware of their obligations under state law to provide voting leave for their employees.
While there is no federal law that requires private sector employers to provide employees with time off from work to vote in a national or state election, numerous states require that private sector employees be provided with either unpaid or paid time off to vote.
The chart below summarizes the general voting leave requirements of all 50 states and the District of Columbia:
Note: Many states have additional rules regarding time off to vote. Employers are strongly advised to review the applicable state law and contact a knowledgeable employment law attorney for further guidance.