3 Simple Steps to Tidy Up Your Benefits Communications (Marie Kondo Style)

There’s a reason Marie Kondo’s Netflix Series, Tidying Up, is the first bingeable sensation of 2019. It’s fun to watch other people wade through years of collected items, but there’s also an underlying current of shared understanding—that feeling of being so overwhelmed that you simply don’t know where to begin. If you’ve ever felt that way about your employee benefits communications, you’re not alone!

With five generations of Americans in the workforce, each with their own communication preferences, it can be complex to engage and target your audience. Granted, Kondo wasn’t thinking about healthcare when she created her now famous method of organization, but many of her rules apply to how you communicate your benefits.

Kondo teaches us that decluttering—lovingly letting go of items that no longer spark joy—is one way to help us understand more about what’s essential in our lives. Employee Benefits and the communication methods associated with them can be approached the same way. There are so many plans out there, so many options to communicate your benefits to employees – mobile, video, webinars, face-to-face, email, intranet, social media, phone, text message, printed guidebooks, direct mailers, etc.—that your benefits communications can get cluttered quickly.

While multiple channels and tactics are good, it’s all about aligning a clear message to the right audience through the correct channels. Which is why you should tidy up your benefits communications from time to time. That way you can reevaluate how you’re reaching your employees and whether you’re doing so effectively.

So, what should you keep and what should be thrown away? That all depends on your company and benefits goals and objectives.

Commit yourself and do the prep work

Marie Kondo is all in, and she urges her clients to think of tidying up as a commitment, not a cleanup job. The same goes for reorganizing your benefits communications. Constructive changes don’t happen overnight, and if your goal is to reduce the cost of healthcare while still offering benefits your employees want, you’ll need an annual communication plan.

Consider this part the prep work. Start with a goal and defined key communications objectives. Perhaps you want your employees to better understand when to access the proper care—whether through telemedicine, urgent care or the ER. Or your members need to better understand and control rising pharmacy costs. When you focus on a few key communication goals, you commit to sending a focused message that people understand.

Imagine your ideal benefits

We all have a best life, and Kondo thinks decluttering helps you find your ideal self. All you need to do is see it and work towards achieving it. Her method might seem idealistic, but it does suggest that a clear vision is required for success. Tidying—or optimizing—your benefits can’t happen unless you have a clear idea of what you want to offer and how you want to communicate with your employees. That’s why setting your annual goals is so important.

Follow the right (communications) order

The best benefits communications suite for your organization starts with understanding your employees. By taking the time to curate your messaging to your audience and align communications with organizational goals, you can tidy up your communications channels and focus on the greater benefits objectives. Knowing that you are communicating topics that align with your goals, you’ll have a far easier time tidying up your communication channels and focusing on what matters and to who.

Interested in learning more about tidying up your employee benefits? Hays Companies is here to help you KonMari your way to a better benefits communication! Contact us today for more information.

Compliance Webinar | Employer Reporting: a 1094-C and 1095-C Refresher

2018 marks the fourth year for which Applicable Large Employers (ALEs) must report offers of health coverage to full-time employees to the IRS on Form 1094-C and provide Employee Statements (Form 1095-C). The deadline for providing Form 1095 to employees is March 4, 2019. Employers must file Form 1094-C and copies of Form 1095-C by February 28, 2019 if paper forms are filed, or April 1, 2019 if the forms are filed electronically. Final forms and instructions have been released by the IRS. This webinar will provide a refresher intended to help employers complete these forms.

This webinar, presented by Hays Companies Research and Compliance Department, covers Employer Reporting: a 1094-C and 1095-C Refresher

Other topics this webinar will address include:

  • Employers subject to reporting
  • Deliver and filing requirements
  • General reporting method and required information
  • Reporting codes
  • Reporting scenarios

You can watch the webinar here.

Please contact your Hays Companies representative for further information. 

Hays Companies Employee Benefits Presents: Upcoming Webinars in 2019

We are pleased to announce the upcoming Hays Companies Webinar schedule for the first half of 2019. Registration information for each webinar, actual dates, and complete details will be made available closer to the event.

As always, please reach out to your Hays Companies representative with any questions.

Date Topic
January Employer Reporting: a 1094-C and 1095-C Refresher
February FMLA and its Impact on Health and Welfare Benefits
March Medicare: a Timeless Topic
April ERISA: Why Does Everyone Keep Talking Wrap Documents?
May Planning for Mergers and Acquisitions
June HIPAA: Protecting Your PHI and Protecting You From Penalties

Note: additional webinars may be added due to legislative changes, rulings, guidance or other developments impacting employee benefits.

Topics and dates are subject to change due to unforeseen circumstances

Biometrics: The Inside Story

In this age of technological and scientific breakthroughs, the most revealing medical insights may come from a single drop of blood. Biometric screenings provide employees with a detailed analysis of their current state of health, as well as insights into what the future might hold. By understanding potential issues, blood screenings could help address concerning health complications before they become serious problems.

There’s a data set in blood that is ten times—even 100 times—more interesting than that in the genome.”

Dr. Eugene Chan

Every drop of the 1.5 gallons of blood flowing through the human body teems with data. By matching blood samples to height, weight and BMI, screenings can help identify health conditions such as diabetes and heart disease.

The future of biometrics

Blood samples are currently an effective measure of health, but scientists and entrepreneurs are taking steps to advance the capabilities of biometric screening. No longer satisfied with the simple metrics of today’s tests, doctors like Eugene Chan, CEO of the DNA Medicine Institute, want to take testing to the next level. “There’s a data set in blood that is ten times—even 100 times—more interesting than that in the genome,” he told Time Magazine.

Chan’s work taps into the vast potential in blood to indicate what illnesses may be lurking in the body. Chan believes that in the future, blood screening could detect early signs of breast cancer and Alzheimer’s, increasing the likelihood that treatment begins before toxic changes start attacking the brain and increasing the potential for successful recovery.

Health through awareness

While Chan is certainly forward-thinking, today’s biometric screenings can still improve health through awareness. By providing a snapshot of overall health, blood testing can uncover potentially unknown conditions, such as high cholesterol or blood pressure, which can be managed with simple lifestyle changes if detected early enough. Those small choices could have a big impact; biometric screening may help lower worker’s compensation costs and reduce the number of large claims.

According to the Center for Disease Control (CDC) and International Monetary Fund (IMF), more than $225 billion is lost every year because of absenteeism, which includes employees with illnesses and those who suffer from chronic diseases. Blood tests performed during a biometric screening can identify what the CDC found to be the most expensive health conditions in the US: high blood pressure, heart disease and diabetes. Often these illnesses can be managed by creating more informed employees who understand the risks associated with not taking care of their health. Biometric screening may be the wakeup call many need to create lasting lifestyle changes.

More about wellness

There are many paths a company can take to develop a wellness program. A carefully designed multi-dimensional program can lead to long-term results and a healthier workforce.

Contact us to learn more about how Hays can help build a targeted wellness program right for your organization.

Entire ACA Ruled Invalid

On December 14th, a judge in the United States District Court for the Northern District of Texas, Fort Worth Division, ruled that the Affordable Care Act’s (ACA) individual mandate is unconstitutional and that the remaining provisions of the ACA are inseverable and therefore invalid.

The ruling is based upon the change to the individual mandate contained within the 2017 tax reform bill that eliminated the individual mandate’s tax consequences. Under the new law, people who decide against insurance coverage no longer must pay a fine. The District Court’s decision hinged on that change.

While the ruling puts the ACA’s future in jeopardy, the federal government is making no immediate changes to laws and regulations. According to a statement from the Department of Health and Human Services (HHS), the government “will continue administering and enforcing all aspects of the ACA as it had before the court issued its decision. They added that the decision “does not require that HHS make any changes to any of the ACA programs it administers…at this time.”

In short, it’s business as usual until Judge O’Connor’s decision makes its way through the court system. A group of states led by California vowed to appeal the ruling and the issue will most likely make its way to the Supreme Court.

The ACA was previously upheld as constitutional by the Supreme Court in 2012. However, the same result is not certain today given the changes in individual mandate laws and a more conservative court.

That said, businesses should continue to comply with the various requirements under the ACA including 1095 reporting, W-2 reporting and minimum essential coverage offerings that meets the value and affordability requirements under the ACA.

IRS Announces Employee Benefit Plan Limits for 2019

Highlights

  • The IRS recently announced cost-of-living adjustments to the annual dollar limits for employee benefit plans.
  • Many of these limits will increase for 2019.
  • In 2019, employees may contribute more money to their HSAs, health FSAs and 401(k) accounts.

Overview

Many employee benefits are subject to annual dollar limits that are periodically increased for inflation. The Internal Revenue Service (IRS) recently announced cost-of-living adjustments to the annual dollar limits for various welfare and retirement plan limits for 2019. Although some of the limits will remain the same, many of the limits will increase for 2019.

The annual limits for the following commonly offered employee benefits will increase for 2019:

  • High deductible health plans (HDHPs) and health savings accounts (HSAs);
  • Health flexible spending accounts (FSAs);
  • Transportation fringe benefit plans; and
  • 401(k) plans.

Action Steps

Employers should update their benefit plan designs for the new limits and make sure that their plan administration will be consistent with the new limits in 2019. Employers may also want to communicate the new benefit plan limits to employees.

HSA and HDHP Limits

HSA Contribution Limit
Limit 2018 2019 Change
Self-only HDHP coverage $3,450 $3,500 Up $50
Family HDHP coverage $6,900 $7,000 Up $100
Catch-up contributions* $1,000 $1,000 No change

*Not adjusted for inflation

HDHP Limits
Limit 2018 2019 Change
Minimum deductible Self-only coverage $1,350 $1,350 No change
Family coverage $2,700 $2,700 No change
Maximum out-of-pocket Self-only coverage $6,650 $6,750 Up $100
Family coverage $13,300 $13,500 Up $200

FSA Benefits

FSA Limits
Limit 2018 2019 Change
Health FSA (limit on employees’ pre-tax contributions) $2,650 $2,700 Up $50
Dependent care FSA (tax exclusion)* $5,000 ($2,500 if married and filing taxes separately) $5,000 ($2,500 if married and filing taxes separately) No change

*Not adjusted for inflation

Transportation Fringe Benefits

Transportation Benefits
Limit (monthly limits) 2018 2019 Change
Transit pass and vanpooling (combined) $260 $265 Up $5
Parking $260 $265 Up $5

Adoption Assistance Benefits

Adoption Benefits
Limit 2018 2019 Change
Tax exclusion (employer-provided assistance) $13,840 $14,080 Up $240

Qualified Small Employer HRA (QSEHRA)

QSEHRA
Limit 2018 2019 Change
Payments and Reimbursements Employee-only coverage $5,050 $5,150 Up $100
Family coverage $10,250 $10,450 Up $200

401(k) Contributions

401(k) Contributions
Limit 2018 2019 Change
Employee elective deferrals $18,500 $19,000 Up $500
Catch-up contributions $6,000 $6,000 No change

Resources

This Compliance Bulletin is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.

HSAs & FSAs: Eligibility and Contribution Limits

Introduction

HSAs (Health Savings Accounts) and FSAs (Flexible Spending Accounts): Are both accounts designed to help employees put aside money to pay for extra medical expenses on a pre-tax basis, both have rules around maximum contributions and permissible distributions, and both have remarkably similar sounding acronyms. However, the similarities for the most part, stop here.

The Hays Research and Compliance Department often answers questions from employers who are confused as to how these two types of accounts impact each other. Most of these questions are a result of misunderstanding HSA eligibility rules, or applying these rules to FSAs. In this article, we will briefly discuss both HSAs and FSAs independently, and then discuss how they impact each other in terms of eligibility.

Health Savings Accounts (HSAs)

What is an HSA?

A Health Savings Account (HSA) is often referred to as a Consumer Driven Health Plan (CDHP). An HSA is an account through which eligible individuals can make contributions, and receive employer contributions, on a tax-free basis through an employer’s cafeteria plan. Whether an individual is eligible to contribute to an HSA does not impact whether the individual is eligible for the underlying high deductible health plan. Further, the individual and his or her spouse and dependents do not need to be eligible to contribute to an HSA, to take tax-free distributions from the HSA for qualified medical expenses. An HSA account is owned by the individual, not by the employer. Therefore, individuals will have access to the account after employment with an employer ends.

Eligibility

To be eligible to contribute to (or receive contributions to) an HSA, two things must be true: 1. The individual must be covered under a qualified high deductible health plan (QHDHP). 2. The individual must not be covered by disqualifying other coverage.

A high deductible health plan is considered qualified, and allows a person to contribute to an HSA, if it meets both the minimum annual deductible standards and the maximum out-of-pocket limit standards set by the IRS.

Qualified HDHP 2017 2018 2019
Minimum Annual Deductible Self Only: $1,300

Family: $2,600

Self Only: $1,350

Family: $2,700

Self Only: $1,350

Family: $2,700

Out of Pocket Limit Self Only: $6,550

Family: $13,100*

Self Only: $6,650

Family: $13,300*

Self Only: $6,750

Family: $13,500*

*The individual limitation on cost-sharing under the ACA applies regardless of whether the individual is covered by a self-only plan or a plan that is other than self-only. The ACA individual cost-sharing limit is customarily lower than the QHDHP out of pocket limit for families. Therefore, it may be necessary to embed an individual out-of-pocket maximum for individuals covered under a family HDHP, no higher than the ACA limit for individuals. In no case, should this embedded limit be smaller than the family minimum annual deductible.

In addition to being enrolled in a QHDHP, an individual may not be enrolled in any other health care plan that is not a QHDHP, before the minimum annual deductible is met, to be HSA eligible. Examples of other coverage that will cause a person to lose HSA eligibility are other major medical coverage, general purposes health FSAs, HRAs (Health Reimbursement Arrangements), and Medicare.

Maximum Annual Contribution

Contributions to an HSA are subject to limits set by the IRS. The limits are updated annually, and are impacted by the number of people covered by the qualified HDHP, the number of months out of the year an individual is eligible for an HSA, and the individual’s age. Both employee contributions and employer contributions count toward the maximum annual contribution.

In general, an individual’s annual limit is calculated by dividing the annual limit by 12 and multiplying by the number of months the individual was eligible to contribute. An individual is eligible to contribute for a month, if they have HDHP coverage, and no disqualifying other coverage as of the first day of that month. As an exception to this general rule, if an individual is HSA eligible as of the first day of the last month of the taxable year (December 1st), the individual can contribute up to the annual maximum, if they remain HSA eligible for the rest of the month and the entire next year.

An individual who is at least age 55 may make an extra $1,000 contribution for a year. This additional contribution is calculated in the same manner as the base contribution. In other words, it is calculated monthly, unless the full-contribution rule applies. An individual does not have to be age 55 for every month in the year to make the full $1,000 contribution. Each spouse age 55 or older, with their own HSA account, is eligible to make a full HSA catch-up contribution regardless of whether either spouse has family HDHP coverage.

HSA Contribution Limits* 2017 2018 2019
Self-Only HDHP $3,400 $3,450 $3,500
Family HDHP (anything other than self-only coverage)

$6,750

$6,900

$7,000

*If both spouses have self-only HDHP coverage, both can contribute the self-only maximum. If one or both spouses have family coverage, the family annual limit is divided between them.

Flexible Spending Accounts (FSAs)

What is an FSA?

A Flexible Spending Account (FSA) is an account through which eligible individuals can contribute amounts on a tax-free basis through an employer’s cafeteria plan. An FSA account is often referred to as a Flex-Account. FSA funds can be distributed tax free if used for qualifying medical expenses. An FSA account is owned by the employer plan sponsor, not the by the individual. Further, FSAs are subject to a “use it or lose it” rule. Therefore, if an employee leaves employment with the employer plan sponsor before the account is emptied, or does not use the amount elected by the end of the plan year, they will (with certain exceptions) lose the portion of their contribution remaining in the account.

Eligibility

Unlike HSAs, there are no requirements under the tax-code about what other coverage an individual must be enrolled in to take advantage of an FSA. However, an employer may require an employee to be enrolled in one of their major-medical plans to enroll in the FSA. Further, unlike HSA eligibility, FSA eligibility is not conditioned on the individual not having disqualifying other coverage.

Maximum Annual Contribution

The maximum annual contribution an individual may make to an FSA is set by the employer, and is subject to IRS regulations. The contribution limit is applicable to employee salary reductions. Employer contributions to a health FSA are only subject to the limit where an employee could have elected to receive that amount as taxable cash (or some other taxable benefit). All contributions to any FSA sponsored by an employer within the same controlled group will count toward the annual maximum. If an individual makes contributions to multiple FSAs, through employers who are not a part of the same controlled group, the entire contribution limit will apply separately to each of the FSAs.

If a single employer has both a limited-purpose and a general-purpose health FSA, the maximum contribution limit is shared between the two FSAs. Whether an individual is enrolled in self-only coverage, or coverage that includes any other individuals, does not impact the maximum annual contribution under a health FSA.

FSA Contribution Limits

2017 2018 2019
$2,600 $2,650 $2,700

 

HSAs and FSAs

Most of the confusion surrounding the way HSAs and FSAs impact each other, are a result of misunderstanding HSA eligibility rules, or applying these rules to FSAs. If an employer can remember a few simple things, most of this confusion can be alleviated.

  1. HSA contributions do not impact eligibility for coverage under an FSA.
  2. Coverage under an FSA results in ineligibility to contribute to or receive contributions to an HSA.
  3. Coverage under an FSA can come from unexpected places (such as a spouse’s coverage, or an extension of the FSA coverage through a grace period or rollover).

FSA as Disqualifying Other Coverage

If an employee is enrolled in a general-purpose health FSA through his or her employer, that employee is not HSA eligible. However, if the health FSA is what we refer to as “limited purpose,” or in other words covers only certain excepted benefits such as dental and vision, it will not preclude HSA eligibility. Further, if the FSA is set up to be a “post-deductible FSA,” so that it will not reimburse medical expenses until after the deductible has been satisfied, it will not preclude HSA eligibility.

One often overlooked source of disqualifying other coverage, is a spouse’s FSA. If a spouse is covered under a general purposes FSA that reimburses expenses before the deductible is satisfied, it is likely that the employee’s medical expenses could also be covered under that FSA. Where this is the case, neither the employee nor the spouse is HSA eligible. This is true even where the employee’s spouse does not actually use his or her FSA on the employee’s expenses.

In most cases, if an individual does not use his or her FSA funds by the end of the plan year, he or she will forfeit the amount remaining in the account. However, there are certain ways that a plan sponsor can design the account to give the individual extra time to use the left-over amount.* The first option, is to allow for what is called a “rollover.” If an employer allows any amount to “rollover” into an FSA for the individual into the next year, that individual will be ineligible for an HSA for the entire next year, unless they opt-out-of receiving that rollover. The person remains ineligible for an HSA for the entire year, regardless of when the individual actually exhausts his or her FSA funds that rolled over.

Instead of a rollover, some employers allow for what is referred to as a “grace-period.” A grace-period is a period of time after the close of the plan year, where individuals can continue to incur medical expenses to be used for whatever is still remaining in their FSA account from the prior year. If an individual did not elect an FSA for a given year but has greater than a $0 balance at the end of the coverage period, he or she will be HSA ineligible for the duration of the grace-period.

*HSA eligibility is not precluded by a run-out period, where an individual has not elected an FSA for the subsequent plan year. A run-out period is a period of time designated into the next plan year, during which the individual can submit expenses for reimbursement that were incurred during the prior plan year.

Conclusion

The Hays Research and Compliance Department would like to suggest the following approach to clients to help them ensure their employees’ compliance with HSA eligibility provisions.

  1. Ensure no employees are permitted to enroll in a general-purpose FSA, and at the same time contribute to an HSA.
  2. Ensure that any individual who will be taking advantage of a grace-period or a rollover provision under an FSA, is not also planning on contributing funds to an HSA as if they are eligible for those months.
  3. Advise employees that if their spouse (or parent for dependent children) is covered under an FSA which could reimburse their medical expenses, they are not eligible to make or receive contributions to an HSA.

For more information on HSAs, please check out the following webinar, recorded by the Hays Research and Compliance Department: Health Savings Accounts: What You Need to Know

IRS/DOL Disaster Relief for Victims of California Wildfires

Yesterday, the IRS issued new guidance expanding tax deadline relief to taxpayers in California who were affected by wildfires, including an extension for filing Form 5500 for their employee benefit plans.  The following California counties are included in the disaster relief area: Butte, Los Angeles and Ventura.  Affected businesses with upcoming deadlines for filing 5500s (and certain tax filings*) that fell between November 8, 2018 and April 30, 2019, now have until April 30, 2019 under the special extension.

*The relief does not extend deadlines for W-2s, employer ACA reporting (forms 1094-C and 1095-C), and certain other information returns.

If you have been affected by the wildfires and are unable to file your 5500s (with original or extended 5500 deadlines falling between the above dates) and wish to use the special extension, please reach out to your Hays Representative or info@hayscompanies.com for specific instructions on how to report on Form 5500 to avoid late filing penalties.

2018 W-2s and Your Employee Benefits

The January 31st W-2 deadline will be here before you know it, and there’s a lot your team needs to prepare between now and then. There are employee health and wellness benefits to keep in mind, much of which is outlined in the IRS’s 2018 General Instructions for Forms W-2 and W-3.

Below are the top six reporting issues that employers generally encounter:

Employee health coverage

The ACA requires that employers who issue at least 250 W-2s reflect the value of health coverage on Box 12 of Form W-2. Reporting of health care costs is optional for employers issuing fewer than 250 W-2s but is encouraged by the IRS. The 250 W-2 threshold is based on the reporting employer’s Federal Employer ID Number (FEIN), regardless of the aggregate size of a controlled group. This information does not increase the employees’ taxable income (Box 1 wages).

  • For fully-insured plans, the total premium rate (employer and employee contributions) is reported.
  • For self-insured plans, the COBRA rate (exclusive of the 2% COBRA administration fee) may be used, per the IRS.
  • Employee elective contributions to a health FSA are not required to be reported; however, if the employer makes contributions to the employee’s health FSA over and above the employee’s election, that amount should be included in the Box 12 calculation.
  • Stand-alone dental and vision benefits may be excluded from the calculation (their inclusion is optional).

Employer-provided group term life insurance (See IRS Publication 15-B)

  • After excluding the first $50,000 in benefit, the “premium” value (based on Table I rates) for non-discriminatory plans that provide either the same flat dollar death benefit or multiple of earnings benefit for all eligible employees is included in employees’ taxable earnings (Boxes 1, 3 and 5).
  • For discriminatory (class-specific) benefits that differentiate by class, the entire value is taxable for key employees (the income exclusion for the first $50,000 in death benefit does not apply). For non-key employees, the exclusion is still applicable.
  • Voluntary term life insurance policies that “straddle” the Table I rates (i.e., at least one employee pays more than Table I and at least one employee pays less) are employer-provided group term life insurance and must be imputed. However, the employer can deduct the employee’s actual cost of the coverage from the imputed amount.

Health care benefits for domestic partners and other non-dependents

  • Internal Revenue Code Section 105(b) permits certain qualified benefits provided to employees or former employees, their spouses and dependents to be excluded from taxable income.
  • Employers offering domestic partners health care (medical, dental and vision) coverage must include the fair market value of the coverage provided (employer and employee contributions) for domestic partners (unless the partner is considered the employee’s tax dependent) and other non-dependents in W-2 earnings, Boxes 1, 3 and 5, for income tax purposes.

Dependent Care Assistance Plans (DCAPs)

Employee salary reduction elections are excluded from taxable earnings. Report the fair market value of dependent care benefits paid by the employer (including amounts paid directly to a daycare facility, reimbursed to an employee, or provided in kind by the employer), as well as employee elections under a dependent care FSA in Box 10.

Health Savings Accounts (HSAs)

Employer contributions (including employee contributions through the employer’s cafeteria plan) should be reported in Box 12. Employer HSA contributions that are not excluded from employees’ income (i.e., they are outside the employer’s cafeteria plan) are also taxable income and are reportable in boxes 1, 3 and 5.

Third Party Sick Pay Reporting for Disability Benefits

Disability benefits are subject to payroll tax (FICA and FUTA) for the first six months of benefit when the coverage is employer-paid. Generally, the employer is responsible for the employer match and must report the value of the benefit as third-party sick pay. However, some exceptions may apply (for example, if the insurer is making the employer and employee FICA matching contribution and providing the employee with a W-2 on behalf of the employer). (Refer to IRS Publication 15-B for more details)

The applicable codes to be used are described in the General Instructions (see the link in the first paragraph, above).

This information is a high-level overview and should not be considered legal or tax advice. If you have specific questions, you should contact your legal or tax advisor. For more information about your benefits offerings, reach out to your Hays Companies service team.

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2019 Retirement Plan Contribution Limits

The Internal Revenue Service today announced cost of living adjustments affecting dollar limitations for defined contribution and defined benefit plans for tax year 2019.  These items were detailed in Notice 2018-83.

Highlights of Changes for 2019

  • The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $18,500 to $19,000.
  • The limitation used in the definition of “highly compensated employee” is increased from $120,000 to $125,000.

Highlights of Limitations that Remain Unchanged from 2018

  • The catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan remains unchanged at $6,000.

If you have any questions regarding these changes or about any other aspects of your employer-sponsored retirement plan, please do not hesitate to reach out to a member of the Hays Financial Group team by contacting info@hayscompanies.com