Employee Benefits & Executive Compensation Blog

The View from Proskauer on Developments in the World of Employee Benefits, Executive Compensation & ERISA Litigation

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Employee Benefits & Executive Compensation Blog

An Additional Word from IRS Regarding the ARP COBRA Subsidy

By Paul M. Hamburger & Roberta Chevlowe

July 27, 2021

The IRS just released some new supplemental guidance on the COBRA premium subsidy in the American Rescue Plan Act (“ARP”). IRS Notice 2021-46, released July 26, 2021 provides additional color on a handful of discrete subsidy issues that had been addressed in earlier guidance but still caused some confusion. The guidance, in Q&A format, addresses: the availability of the subsidy during extended coverage periods due to disability determinations, second qualifying events, and state law extensions,…

Employee Benefits & Executive Compensation Blog

A Practical Guide to Claiming the COBRA Premium Assistance Tax Credit

By Paul M. Hamburger, Tanusha Yarlagadda & Jennifer Rigterink

July 26, 2021

Over the last few months, employers and plan administrators have concentrated on identifying qualifying individuals eligible for COBRA premium assistance under the American Rescue Plan Act of 2021 (“ARP”), sending out proper notices, and collecting election forms. Now that the dust has settled on the first round of election notices, employers and plans have turned their attention to another pressing topic: claiming the COBRA premium assistance tax credit. Why is it Important to Apply…

Employee Benefits & Executive Compensation Blog

PBGC Releases Guidance on New Special Financial Assistance Program for Troubled Multiemployer Plans

By Ira Golub, Robert Projansky, Justin Alex & Mary Grace Richardson

July 15, 2021

As a follow up to our previous alert on the American Rescue Plan Act of 2021, we have summarized the key aspects of the recently released PBGC and IRS guidance on the new Special Financial Assistance Program for troubled multiemployer pension plans in our latest client alert, which can be found here.…

Employee Benefits & Executive Compensation Blog

District Court Denies Interlocutory Appeal for Novel Issue of “Hardwired” 401(k) Plans

By Sydney Juliano

July 14, 2021

A federal district court in Maryland recently declined to certify an interlocutory appeal to the Fourth Circuit on the issue of whether financial institutions can “hardwire” a preference for their own proprietary investment vehicles into their employees’ 401(k) plans. David G. Feinberg, et al., & all others similarly situated, Plaintiffs, v. T. Rowe Price Group, Inc., et al., Defendants, No. 17-cv-427, 2021 WL 2784614 (D. Md. July 2, 2021). In so ruling, the district court…

Employee Benefits & Executive Compensation Blog

Tenth Circuit Addresses Damages for Excessive Recordkeeping Fee Claims

By Myron Rumeld & Anastasia Gellmen

July 12, 2021

One of the multitude of recent cases challenging the recordkeeping fees of 401(k) plans recently made its way to the Tenth Circuit Court of Appeals. Ramos v. Banner Health, No. 20-1231, — F.3d —- (10th Cir. June 11, 2021). Following a bench trial that resulted in a determination that the fiduciaries of Banner Health’s 401(k) plan had failed to monitor the plan’s uncapped, asset-based, revenue sharing arrangement with Fidelity, the Court affirmed the district court’s…

Employee Benefits & Executive Compensation Blog

Temporary Relief for Witnessing Spousal Consent Extended for Another Year

By Katrina McCann & Robert Projansky

June 24, 2021

Just when we were about to draft our blog reminding plans of the expiration of the temporary relief. . . The IRS has now issued Notice 2021-40 extending for another year the temporary relief from the requirement that spousal consent for plan distributions or loans be witnessed in person. As discussed in greater detail in our earlier post, in response to the COVID-19 National Emergency, the IRS previously issued guidance temporarily allowing a notary…

Employee Benefits & Executive Compensation Blog

Calculating the ARP COBRA Premium Subsidy Tax Credit

By Roberta Chevlowe, Katrina McCann & Mary Grace Richardson

June 11, 2021

On May 18, 2021, the IRS released Notice 2021-31 (the “Notice”) providing guidance on the temporary 100% COBRA premium subsidy under the American Rescue Plan Act of 2021 (“ARP”), summarized generally here. The Notice addresses how to calculate the premium subsidy and the corresponding tax credit available to premium payees, as well as the rules for claiming the tax credit. Calculating the Tax Credit: Generally The general COBRA rules provide that a group health…

Employee Benefits & Executive Compensation Blog

A Word from the IRS on Involuntary Terminations of Employment for Purposes of the ARP COBRA Premium Subsidy

By Paul M. Hamburger, Roberta Chevlowe, Katrina McCann & Joshua E. Stephens

June 9, 2021

One important question that arises when determining whether an individual is eligible for the COBRA premium subsidy under the American Rescue Plan Act of 2021 (“ARP”) is whether the employee has experienced an involuntary termination of employment. (See our prior blogs on the ARP subsidy, here.) The IRS’s recent Notice 2021-31 (the “Notice”) provides helpful guidance on this issue. What is an Involuntary Termination? One of the key interpretive questions under ARP is “what…

Employee Benefits & Executive Compensation Blog

All Good Subsidies Must Come to an End, Part II: The IRS Adds Some Nuances

By Katrina McCann

June 4, 2021

In an earlier post we reviewed the end dates for the ARP COBRA premium subsidy provided by the American Rescue Plan Act of 2021 (“ARP”), and addressed the required expiration notice. This post revisits the topic in light of the new guidance in IRS Notice 2021-31 (the “Notice”). In general, for individuals otherwise eligible for the COBRA premium subsidy, the subsidy ends on the earliest of: The end of the subsidy period set forth in…

Employee Benefits & Executive Compensation Blog

Guide to New IRS Guidance on COBRA Premium Subsidy

By Paul M. Hamburger, Roberta Chevlowe & Jennifer Rigterink

May 27, 2021

On May 18, 2021, the IRS released Notice 2021-31, which provides implementation guidance on the COBRA premium subsidy available under the American Rescue Plan Act of 2021 (ARP). As discussed in our prior blog posts, ARP includes a 100% COBRA premium subsidy for qualifying individuals during periods of COBRA continuation coverage from April 1, 2021 through September 30, 2021. The guidance in Notice 2021-31 includes helpful information for employers and plan sponsors administering…

Employee Benefits & Executive Compensation Blog

The View from Proskauer on Developments in the World of Employee Benefits, Executive Compensation & ERISA Litigation

Blog Authors

An Additional Word from IRS Regarding the ARP COBRA Subsidy

A Practical Guide to Claiming the COBRA Premium Assistance Tax Credit

PBGC Releases Guidance on New Special Financial Assistance Program for Troubled Multiemployer Plans

District Court Denies Interlocutory Appeal for Novel Issue of “Hardwired” 401(k) Plans

Tenth Circuit Addresses Damages for Excessive Recordkeeping Fee Claims

Temporary Relief for Witnessing Spousal Consent Extended for Another Year

Calculating the ARP COBRA Premium Subsidy Tax Credit

A Word from the IRS on Involuntary Terminations of Employment for Purposes of the ARP COBRA Premium Subsidy

All Good Subsidies Must Come to an End, Part II: The IRS Adds Some Nuances

Guide to New IRS Guidance on COBRA Premium Subsidy

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