Beginning Jan. 1, 2020, some employers will be able to offer individual coverage HRAs (ICHRAs) to help employees pay for individual health insurance. ICHRAs were established by a final rule published on June 20, 2019, which raised questions about how existing federal rules will apply to ICHRAs.
As a result, on Sept. 30, 2019, the Internal Revenue Service (IRS) published proposed regulations on how the following federal requirements will affect ICHRAs:
- The Section 4980H employer shared responsibility rules under the Affordable Care Act (ACA); and
- The federal nondiscrimination requirements in Internal Revenue Code (Code) Section 105(h).
Taxpayers generally may rely on the guidance provided in the proposed rule prior to a final rule being issued. Comments on the proposed rule will be accepted until Dec. 30, 2019.
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