Serving over 200 companies and more than 2000 families since 1988

2882 Sand Hill Rd. Ste. 119 - Menlo Park, CA 94025 - (650) 854-8963 - (800) 564-4476

Posts made in May, 2018

Sharing of premium payments, between employers and employees, has become a common method of providing a comprehensive benefits package while managing the associated costs. Under this type of arrangement, your employees can access group insurance plans (most notably, health insurance). At the same time, you are able to put a cap on your own expenses, by covering premiums up to a certain amount and then allowing employees to share in the cost. This arrangement provides benefit not only to your employees, but to you as well. But of course, you face certain responsibilities as well. Fiduciary responsibility. As the employer, you withhold from paychecks the employee’s contribution to the benefit plan. As such, certain regulations govern the handling of these funds. Employers are under fiduciary responsibility to use those funds only for the purpose of insurance premium payments, and payments must be made in a timely manner. Consequences for missteps. Accounting is no small task for business owners, and mistakes can be made. But with regard to the aforementioned fiduciary responsibilities, mistakes in this area can be costly. Late premium payments can trigger lapses in insurance coverage, causing no small amount of inconvenience and hardship to employees. The courts recognize these situations as a serious problem, and employers who lapse on insurance payments can face legal problems such as lawsuits. Failing to appropriate employee contributions correctly also results in stiff fines. Income tax obligations. In addition to fiduciary responsibility, you are tasked with keeping appropriate records for tax purposes. The IRS takes a serious view of pre-tax contributions, and lack of appropriate documentation can lead to trouble with auditors. In this case we are talking about Section 125 documents; these must be set up properly, and kept secure in the event that a review becomes necessary. Section 125 adds yet another task to your accounting regimen, but it is one of utmost importance. Sharing the cost of insurance premiums is certainly a worthwhile endeavor for both employer and employee, but as you can see, it is also no simple matter. We urge you to contact us if you have any questions about your benefits plan, and the associated regulations and documentation. We can explain your benefits plan in greater detail, and help to ensure that everything is in...

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If your son or daughter is graduating from college, please pass on our congratulations to him or her! They have fulfilled an important promise to themselves, that will greatly impact their future. Now it’s time to evaluate another big life decision: What will your child do about health insurance? If they enrolled in their school’s health insurance plan for students, that plan will probably expire soon. The first thing your new graduate should do is call the plan administrator, and ask how graduating will affect enrollment in the plan. Since health conditions or accidents can strike at any age, going without insurance can create a significant financial risk. Now it’s time to begin evaluating their options. Option One: Join a parent’s health insurance plan. If your own’ health insurance plan covers dependents, children under age 26 can usually be added to it. Of course, this plan might, or might not, be a good fit for your child personally. Check the details carefully, so that you both understand provisions such as co-pays, deductibles, coverage limits, and provider networks. Option Two: Enroll in an Individual healthcare plan. Talk about “adulting”! Shopping for their own Individual healthcare plan can feel like a daunting process to your graduate, but it’s just one of a series of decisions that lead to greater independence. Normally, consumers can’t enroll in a health insurance plan outside of the annual Open Enrollment period, which begins in November. But your child might qualify for a Special Enrollment Period if they meet one of these circumstances: They’re losing your current health insurance (such as a school plan) They’re dropping off of their parents’ plan They’re moving away from the place they attended school They experience other major life changes, like getting married or having a baby The easiest way to know whether your young graduate will qualify for a Special Enrollment Period is to simply ask! Give us a call, and we can help you and your child evaluate the options and decide how to...

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