On May 5, 2022, McDermott Partner Allison Wilkerson delivered a presentation during the 2022 TEA National Conference titled “Mature ESOPs: Remodeling the House You Own.” Her presentation focused on the traits of a sustainable employee stock ownership plan (ESOP), common concerns of a mature ESOP and other ESOP-specific investment issues. Allison and her co-presenters also discussed redemption, re-leveraging and the hot acquisition market.
The presentation concluded with the following suggestions:
There are options available no matter where you are in the ESOP life cycle.
Gauge your employee-owners.
Respond with changes that make the ESOP more relevant.
Reach out for help—the ESOP community is vested in your company’s success.
Employee benefits professionals are inquiring about relief options for proposed regulations for required minimum distributions (RMDs). According to this Tax Notes article, the proposed regulations would make determining the RMDs during the plan participant’s lifetime and the designated beneficiary more challenging for plan sponsors, IRA trustees and custodians, and third-party administrators. One of the major concerns is the implementation of the 10-year distribution period for most beneficiaries of individuals who die in 2020 or later. McDermott Partner Todd Solomon said the 10-year distribution period is a “somewhat surprising development [that] is likely to leave some beneficiaries and their advisers confused and frustrated because of the added layer of complexity and the inability to stretch distributions as under prior law.”
As the popularity of cryptocurrency continues to grow, what do employee benefits lawyers need to know about this emerging investment option? McDermott Partners Andrew Liazos, Andrea Kramer and Brian Tiemann recently offered their perspectives about cryptocurrencies and how they relate to Employee Retirement Income Security Act of 1974 (ERISA) plans, individual retirement accounts (IRAs) and incentive awards in an American Bar Association virtual event.
Pandemic relief, taxes, income inequality, climate change, infrastructure, healthcare and civil rights: the new US administration is moving forward rapidly on President Joe Biden’s stated priorities. So how are these new policies affecting your business? We’re here to keep you informed!
McDermott Will & Emery’s multidisciplinary team of industry-leading lawyers are monitoring key legal areas to help you navigate and gain perspective on the most critical impacts of changing US policies. Access the latest updates in our new resource center.
Jennifer Geetter and Dale Van Demark wrote this bylined article on how companies must manage and govern their use of digital healthcare information assets. “Organizations will need to design and implement digital governance structures that … include additional components and organizational stakeholders, in order to meet the business and strategic demands of the digital health revolution,” the authors wrote.
The Internal Revenue Service (IRS) published final forms and instructions addressing information reporting requirements applicable to employers and insurers under Internal Revenue Code Sections 6055 and 6056. The reporting requirements are effective for tax years beginning in 2015, with the first report due in 2016 for 2015 coverage.
The Affordable Care Act (ACA) generally requires individuals (with limited exceptions) to maintain minimum essential coverage or pay an individual shared responsibility payment with their annual federal income tax return. The IRS will use the information reported by employers and insurers under the information reporting requirements of the ACA to determine individual compliance with the individual shared responsibility requirements and to determine individual eligibility for premium tax credits.
Reporting of Minimum Essential Coverage
Code Section 6055 imposes annual information reporting requirements on insurers, employers that self-insure group health plans and certain other providers of minimum essential health insurance coverage. These entities are required to file annual returns reporting information about the entity and specific information for each individual for whom minimum essential coverage is provided. Covered entities will report the required information to the IRS and to covered individuals on Form 1095-B (click here for instructions). Entities should use Form 1094-B to transmit Form 1095-B to the IRS.
Information Reporting by Applicable Large Employers on Health Insurance Coverage Offered Under Employer-Sponsored Plans
Code Section 6056 imposes annual information reporting requirements on applicable large employers (generally defined as employers with 50 or more full-time employees) that are subject to the employer shared responsibility provisions of Code Section 4980H. These large employers are required to report to the IRS the health insurance or self-insured health care coverage the employer provides to its full-time employees. The return filed with the IRS will describe the health care coverage the employer provides to its full-time employees, including a list of full-time employees, the coverage offered to each full-time employee and the months to which the coverage applied. Entities will report the required information to the IRS on Form 1095-C (click here for instructions), and to each of their full-time employees. Entities should use Form 1094-C to transmit Form 1095-C to the IRS.
Next Steps
Employers sponsoring group health plans should prepare for compliance with the ACA’s information reporting requirements by reviewing their systems to ensure they are able to capture the necessary information to be reported to the IRS based on the above forms.
M&G Polymers USA, LLC v. Tackett, a recent unanimous decision by the Supreme Court of the United States, is a game changer. By expressly repudiating the U.S. Court of Appeals for the Sixth Circuit’s 1983 Yard-Man decision and the many decisions following it, the Supreme Court rejected three decades of Sixth Circuit law inferring that retiree health benefits are vested for retirees’ lives, and provided new clarity in interpretation of retiree medical benefits under collective bargaining agreements.
In this interactive webinar, attorney Todd Solomon—who literally wrote the book on domestic partner benefits—discusses the impact of these rulings and the steps employers should take now to ensure that they are in compliance with all applicable laws for same-sex partners.
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