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Beginning Jan. 1, 2012, Forms 5500 and 5500-SF must have electronic signatures. The consequences of filing without them are serious: it will result in a form not being processed at all, and could result in penalties being imposed on the plan. Forms 5500 and 5500-SF that have no electronic signature will be given a filing […]
Expenses incurred for gender reassignment surgery and hormone therapy are now deductible medical expenses under Code Section 213. The IRS announced in Action on Decision (AOD) 2011-03 that it has acquiesced to a 2010 Tax Court ruling that these expenses are deductible. The AOD appeared in the Nov. 21 Internal Revenue Bulletin. The IRS announcement […]
The IRS has been too vociferous in auditing individuals who have claimed the adoption tax credit, the Government Accountability Office (GAO) suggests in a report. In “Adoption Tax Credit: IRS Can Reduce Audits and Refund Delays,” the GAO reports that the IRS: (1) did not sufficiently train and communicate with its auditors who were examining […]
With the year’s end fast approaching, employers that sponsor tax-qualified retirement plans should assess whether they may require amendments or administrative changes. To help with that process, Todd A. Solomon, a partner in the Employee Benefits Practice Group of McDermott Will & Emery’s Chicago office, and Brian J. Tiemann, also a member of that office, […]
The IRS and Treasury Department want to “initiate a dialogue” with the governmental plan community about how to better define when a retirement plan becomes a government plan, but while dialogue is good, will it result in burdensome regulatory requirements? On Nov. 8, the IRS and Treasury Department issued proposed rules on determining governmental plan […]
Starting 2012, savers can sock away $17,000 per year in a 401(k) retirement plan without paying upfront taxes, up from $16,500 in 2010. This increase applies to all 401(k) and 403(b) plans, most 457 plans and the federal government’s Thrift Savings Plan. The last time the IRS raised this elective deferral (contribution) limit was in […]
Plan administrators and employers that offer adoption assistance and long-term care (LTC) insurance need to adjust their plans for 2012 to account for increased amounts that can be excluded from taxable income. The IRS issued the rates for use in 2012 in Revenue Procedure (Rev. Proc.) 2011-52. Adoption Tax Credit The tax credit under Code […]
Employers worried that they may have misclassified independent contractors may find relief in a new program from the IRS. The Voluntary Classification Settlement Program (VCSP) was announced September 21 and offers employers the opportunity to get into compliance by making a minimal payment covering past payroll tax obligations rather than waiting for an IRS audit. […]
Benefits administrators can be forgiven if their response to the IRS’ latest plan to issue guidance on cafeteria plans is “Promises, Promises!” Finalizing cafeteria plan regulations is the most far-reaching benefits-related item on the IRS 2011-2012 Priority Guidance Plan. The agency proposed café plan regs in 2007 and has been saying that it will finalize […]
Do you have to file the new Form 8955-SSA? If so, you may be able to breathe — and file — a little more easily. The IRS recently provided Announcement 2011-21 clarifying how the form is to be used, including how it is to be signed and electronically filed. The IRS also has provided additional information […]