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News for Business Owners on New Tax Return Due Dates and Health Insurance Premium Reimbursements

Tax Time post-it

Significant changes to tax return due dates enacted this year affect the due dates in 2017. Here are the dates that impact most business entities:

Form 1099-MISC and W2s
These are now due to be filed on January 31.
(Old law had a due date of February 28.)

C-corporations
Tax returns are now due on April 15 or the 15th day of the fourth month after year-end for fiscal year ends.
(Old law due date was March 15 or 15th day of the third month after year-end for fiscal year ends.)

S-corporations
No change. Tax returns remain due on March 15.

Partnerships
Tax returns are now due March 15.
(Due date of the old law was April 15.)

New Law on Health Insurance Premium Reimbursements

A number of years ago, the passage of the Affordable Care Act made it illegal for non-profit and for-profit employers to reimburse employees directly for the health insurance premiums paid by the employees. We worked with MANY non-profit and for-profit employers to make sure they were in compliance with the new law.  In most circumstances, the corrective action that needed to be taken was to include the reimbursed health insurance premiums as compensation to the employee.  On December 13, 2016, President Obama signed the 21st Century Cures Act which grants some relief or creates an avenue for some employers to reimburse their employees tax-free. 

This relief does come at a “cost” in the form of these requirements. If a small employer (under 50 full-time employees) does not offer group health insurance to any of their employees, they can adopt a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA). Under the QSEHRA, an employer can pay or reimburse an employee for any documented healthcare expenses. The employer must fund 100% of the QSEHRA, and there are contribution limits of $4,950 for an employee or $10,000 for a family.  The QSEHRA will be coordinated with any available premium tax credit available on the Marketplace for the employee.  The QSEHRA plan also comes with administrative responsibilities of documenting the medical expenses, providing annual notices to employees, and additional reporting requirements on the annual W2 form for the employee.

If you are one of our many clients that needed to change the way you were reimbursing employees for health insurance premiums, and you feel like you would qualify for the relief above, we would encourage you to speak with your health insurance benefit provider to see how they may be able to help under the new law.

As always, please feel free to contact us online or call 215-723-4881 with any questions.

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