Posted By bahim on Jul 10, 2019
Now that the federal Individual Mandate requirement for health insurance has loosened – since setting the penalty at 0 dollars, the law is effectively nullified – individual states are now passing their own mandate laws. With passage of the Minimum Essential Coverage Individual Mandate, California is poised to join those ranks. Effective January 1, 2020, the mandate requires all Californian residents (along with spouses and dependents) to enroll in a qualified insurance plan for each month of the year. Those who fail to maintain health insurance coverage will be subject to a Shared Responsibility Penalty , to be determined and collected by the Franchise Tax Board. Some exceptions to the law do apply, according to financial hardship and religious belief as dictated by Covered California. Currently, 93 percent of the state’s population is covered by a health insurance plan. New affordability provisions within the law aim to close that gap, so that the state can achieve 100 percent coverage. Currently, individuals and families with incomes between 100 and 400 percent of the federal poverty level can obtain government subsidies to make health insurance premiums more affordable. The new law will expand that bracket up to 600 percent, so that more Californians can obtain coverage. The new legislation also raised Medi-Cal’s age cut-off for undocumented residents, from 18 to 26. In the wake of the new law, we can expect to see a ripple effect upon other policies regarding health insurance. For example, the legislation also calls for additional reporting requirements under Internal Revenue Code 6055. “Applicable entities”,such as health insurance companies and companies which provide health insurance coverage, will be required to provide proof of coverage to the Franchise Tax Board each year. Penalties will be imposed upon companies that fail to complete their filings. We will keep you updated on these changes as they occur. In the meantime, please don’t hesitate to contact us if you have questions about the new health insurance mandate law. We can assist both individuals and employers to ensure that you’re in compliance with the...
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Posted By bahim on Jun 11, 2019
We tend to think of Medicare as “healthcare for retirees”, due to the fact that we become eligible for coverage when we turn 65. But in reality, plenty of people are still working at age 65, and the trend toward later retirement is expected to continue (and even become more common). So, if you’re still working and are covered by a group healthcare plan when you reach your 65’th birthday, you might be wondering what you’re supposed to do about Medicare. Yes, you still need to enroll. When you turn 65, enroll in Medicare regardless of your employment situation. Assuming that you or your spouse have worked at least ten years, and paid taxes into Medicare, you are eligible for premium-free coverage under Medicare Part A. You might also want to enroll in Medicare Part B, or in Part D (prescription drug coverage). Yes, you can have Medicare along with your other health insurance plan. If you already have health insurance coverage, you can still enroll in Medicare at 65. If your employer is a smaller company, Medicare will become your primary coverage and your group health plan will be secondary. In this case you definitely want Medicare Parts A and B, because it will be your primary coverage. If you work for a large employer, that health insurance plan will remain primary, with Medicare serving as secondary coverage. Either way, having group health insurance along with your Medicare could mean lower out-of-pocket costs for you. You can delay Part B and Part D enrollment, if you prefer. Normally, failing to promptly enroll in Part B or D coverage at age 65 can result in paying a penalty when you finally do enroll. However, if you’re still working and are covered by your employer’s plan, you can delay this enrollment with a confirmation of creditable coverage from your employer. This way you can avoid the late enrollment penalties when you do enroll in those plans later. You are responsible for remembering the deadline. You can enroll in Medicare beginning three months before your birth month, or for three months afterward. This is called your Initial Enrollment Period (IEP). Medicare will not remind you of your IEP unless you’re receiving Social Security or Railroad Retirement Board benefits, so mark this date on your calendar. If you have questions about Medicare plans, or how enrollment works when you’re not yet retired, please give us a call. We can offer more detailed advice once we discuss your...
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Posted By bahim on May 13, 2019
A quality group health insurance plan is the backbone of your employee benefit package. But even the most comprehensive plans have their limits, and therefore your employees might experience some gaps between the coverage they need and the coverage they have. In particular, health insurance plans rarely cover vision exams, glasses, or contact lenses. The good news is that you can offer your employees a vision insurance plan as an added, voluntary benefit. They can opt in at no added cost to you (if you set it up that way), but will appreciate the opportunity to obtain quality vision care at group rates. Why Do Employees Choose Vision Insurance? For most of your employees, their benefits package isn’t just about their needs. Their families depend upon these insurance options, too. Vision insurance can cover the entire family, allowing for annual vision checks, and glasses or contact lenses when needed. While health insurance plans generally cover eye exams for children under age 19, spouses are not included, nor are children over 19 who are still utilizing a parent’s policy. Children under age 19 typically have an exam and glasses covered, but you can’t go to just any eye doctor, you must stick to a specific list of providers. Also, considering the amount of “screen time” most of us are getting these days, we all stand a greater chance of needing vision assistance at some point. Even those who have always enjoyed 20/20 vision might find that as they get older, reading glasses become necessary. A Complement to Health Insurance. Eye exams can detect more than just vision problems. Often, the first signs of many health problems are noticed by an optometrist or opthamologist. These can include diabetes, brain tumors, high blood pressure, high cholesterol, and more. And of course, certain degenerative eye disorders like glaucoma and macular degeneration are first detected by a vision screening. When caught early, treatment can save the patient’s sight or at least slow the progression of the disease. Increased Workplace Safety. Vision impacts job performance, too. As an employer, you are likely aware of the various liability issues that can exist in the workplace. Regular vision screenings not only keep employees healthy and happy; they could increase productivity and reduce the risk of accidents as well. Vision insurance offers a valuable voluntary benefit at a comparatively low price. Give us a call to learn more about adding vision insurance to your menu of...
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Posted By bahim on Apr 27, 2019
Many employers have discovered the benefits of offering their workers premium-only plans (POP), which allow employees to pay their health insurance premiums with “before tax” dollars. This means the premiums are deducted from paychecks on a pre-tax basis, saving them money. Of course, as with any other tax code provision, employers are subject to strict regulations when opting for POPs. In particular, the law states that the plan must be non-discriminatory, meaning the plans cannot discriminate in favor of key or highly-compensated employees with regard to eligibility, contributions, or benefits. If the plan’s design benefits a reasonable cross-section of employees, and enrollment is available to all, the plan will most likely pass eligibility and benefits standards. Keeping the plan simple and uniformly available will cut down on the number of tests that the employer must pass. Therefore, in these cases employers only need to worry about the Concentration Test and Dependent Care Test. The Concentration Test states that the non-taxable benefits received by “key employees” must not exceed 25 percent of benefits received by all employees in total. First, we must define key employees, according to IRC 416 (i): Officers of employer who earn more than $160,000 annually Those with at least one percent ownership in the company who earn more than $150,000 annually Those with more than five percent ownership in the company Then, the test formula simply divides the total benefits of Key Employees by the total benefits received by all employees. If the resulting percentage is greater than 25 percent, the plan fails the Concentration Test. The remedy is fairly simple: Key employees must simply pay more of the cost of benefits on an after-tax basis, in order to keep their percentage of benefits below 25 percent. Employers should run the Concentration Test regularly to ensure continuous compliance with the law. Certain special rules do apply, regarding ownership percentages with regard to spouses or family members of key employees. In these cases, professional guidance is essential. For more information on non-discrimination testing and POP plans, please contact us and we’ll be happy to...
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Posted By bahim on Apr 10, 2019
It’s April, and that means tax refund season has arrived once again. Yes, a vacation or new furniture sounds tempting, but you might be wondering about ways to put your tax refund to its best use. We have a few suggestions that can help secure your financial future. Consider Life Insurance Whether you already have a life insurance policy, or you’ve been considering this important coverage, you know that the point is to offer long-term security to your family in the event that something happens to you. But many people face obstacles in securing a life insurance policy, such as: Fitting the monthly premiums into their budgets Remembering to pay premiums (and if you forget, your coverage could lapse) Wondering if they really have enough life insurance, especially when situations changeBy enrolling in a life insurance policy now and using your tax refund to cover the next year’s premiums, you can address all of these issues. Contribute to a Health Savings Account (HSA) If you have out-of-pocket medical costs, you can start or contribute to an existing HSA and use that money for future medical bills. One nice benefit of an HSA is that the money you contribute is tax exempt. So not only do you save for expenses, but you also cut your tax liability. We can answer questions for you regarding HSAs and also help you to start one. Contribute to a Roth IRA You can contribute up to $5500 per year to a Roth IRA and this money will grow tax free. If you are married, both you and your spouse can contribute $5500 to a Roth IRA. When you retire, the funds in your Roth IRA can be withdrawn without any tax liability, making a Roth IRA an advantageous retirement income source. For more information on any of these solutions, please give us a call. We can help you decide what makes the best sense for you and your family and can answer any questions that you might...
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