amendment guidance for qualified retirement plans, Revenue
Procedure 2007-44.Plan sponsors may also, but are not
required to, reflect the outcome of Windsor for periods prior to the date
Windsor was decided.In such a case, a plan amendment is
required.Such optional
amendment must be adopted by the later of December 31, 2014, or the
applicable date under Revenue Procedure 2007-44.
If an employer provided health coverage for an
employee’s same-sex spouse and included the value of that
coverage in the employee’s gross income, the employee can file
an amended Form 1040 reflecting the employee’s status as a married
individual to recover federal income tax paid on the value of the health
coverage of the employee’s spouse for all years for which the period of
limitations for filing a claim for refund is open.
The
Affordable Care Act
The Affordable
Care Act contains provisions for health insurance coverage and financial
assistance options for individuals and families. This new law is
administered by the IRS and is included in the law. The provisions require
you and each member of your family to have qualifying health insurance and
it is called minimum essential coverage. If you or your family member can be
exempt from coverage or make a shared responsibility payment when you file
your federal income tax return.
The Small Business Health Care Tax credit helps
small businesses and small tax-exempt organizations afford the
cost of covering their employees, and is specifically targeted
for those businesses with low and moderate income workers.
Furthermore, The credit is designed to encourage small employers
to offer health insurance coverage for the first time or maintain coverage
they already have. In general, the credit is available to small employers
that pay at least half the cost of single coverage for their employees. To
qualify for the credit for tax years beginning in 2014 and forward, a small
employer must contribute toward premiums on behalf of each employee enrolled
in a qualified health plan (QHP) offered by the employer through a Small
Business Health Options Program (SHOP Exchange). Tax-free treatment for employer-provided health
care to an employee’s child has been extended until the end of
the year in which the child turns age 17.
The costs and reimbursements under employer
health plans for coverage for an employee's eligible children
are free of income taxes and FICA and FUTA taxes regardless of
dependency tests. Cafeteria plans are plans that allow employees to
choose from a menu of at least one qualified benefit and a taxable benefit
(such as cash). Employers with cafeteria plans can permit
employees to pay for health coverage for children with pre-tax
contributions. This tax benefit also applies to self-employed
individuals who qualify for the self-employed health insurance deduction. The Affordable Care Act requires employers to
report the cost of coverage under an employer-sponsored group
health plan on an employee’s Form W-2.
Reporting the cost of health care coverage on Form W-2 is for informational
purposes only.
The
Premium Tax Credit
Starting in 2014, individuals and families who
get their health insurance coverage through the Health Insurance
Marketplace may be eligible for the Premium Tax Credit. In general, you may be eligible for
