United Benefit Advisors Insight and Analysis Blog

Question of the Month: Penalties for failing to comply with Section 125 requirements

Posted by: Karen Hsu    Jul 12, 2018 12:55:32 PM

Q.What are the penalties for failing to comply with Section 125 requirements, such as failing to follow a cafeteria plan document’s terms?

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Topics: cafeteria plan, Section 125 plan, penalties

What Happens to Coverage When Employees Reduce Their Hours?

Posted by: Danielle Capilla    Jun 13, 2017 9:30:00 AM

The Section 125 cafeteria plan regulations and the Patient Protection and Affordable Care Act (ACA) require employers to take certain actions when an employee reduces hours.

Consider this scenario: An employer has an employee who is reducing hours below 30 hours per week. The employee is performing the same job and duties. The employee was determined to be full-time during the most recent measurement period. The employee is currently in a stability period.

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Topics: ACA, cafeteria plan, Affordable Care Act, Section 125 plan, reduction in hours

Cafeteria Plans: Qualifying Events and Changing Employee Elections

Posted by: Danielle Capilla    Feb 7, 2017 9:30:00 AM

Cafeteria plans, or plans governed by IRS Code Section 125, allow employers to help employees pay for expenses such as health insurance with pre-tax dollars. Employees are given a choice between a taxable benefit (cash) and two or more specified pre-tax qualified benefits, for example, health insurance. Employees are given the opportunity to select the benefits they want, just like an individual standing in the cafeteria line at lunch.

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Topics: ERISA, group health insurance, Danielle Capilla, change in status event, cafeteria plan, Section 125 plan, pre-tax benefits, taxable benefits

Nondiscrimination Rules for Cafeteria Plans

Posted by: Danielle Capilla    Oct 13, 2016 10:30:00 AM

A cafeteria plan is an employer-provided written plan that offers employees the opportunity to choose between at least one permitted taxable benefit and at least one qualified employee benefit. There is no federal law that requires employers to establish cafeteria plans; however, some states require employers to have cafeteria plans for employees to pay for health insurance on a pre-tax basis.

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Topics: Danielle Capilla, cafeteria plan, nondiscrimination rules, benefits compliance, Section 125 plan

Top 8 Free (!) UBA Healthcare Cost and Compliance Resources for Employers

Posted by: Bill Olson    Jan 12, 2016 12:00:00 PM

UBA offers a comprehensive library of ACA Advisors and white papers to help employers navigate health care cost and compliance. Every year we look at the documents most accessed by employers and remind our audience of these helpful, free resources. Here’s what was most in demand in 2015.

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Topics: compliance, ACA, health plan benchmarking, UBA Health Plan Survey, Don't Roll the Dice on Department of Labor Audits, cafeteria plan, Affordable Care Act, annual benefit limits, white paper, health care cost, account-based plans

Reporting and Plan Documents Under ERISA and Cafeteria Plan Rules

Posted by: Danielle Capilla    Nov 3, 2015 12:00:00 PM

The Employee Retirement Income Security Act (ERISA) was signed in 1974. The U.S. Department of Labor (DOL) is the agency responsible for administering and enforcing this law. For many years, most of ERISA’s requirements applied to pension plans. However, in recent years that has changed, and group plans (called “welfare benefit plans” by ERISA and the DOL) now must meet a number of requirements.

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Topics: ERISA, Danielle Capilla, cafeteria plan, welfare benefit plans

Cafeteria Plans: How to Handle Participant Contributions

Posted by: Danielle Capilla    Oct 20, 2015 12:00:00 PM

Cafeteria plans, or plans governed by IRS Code Section 125, allow employees to pay for expenses such as health insurance with pre-tax dollars. Employees are given a choice between a taxable benefit (cash) and specified pre-tax qualified benefits, for example, health insurance. Employees are given the opportunity to select the benefits they want, just like an individual standing in the cafeteria line at lunch.

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Topics: ACA, section 125 plans, PPACA Affordable Care Act, Danielle Capilla, cafeteria plan

New ACA Implications for Cafeteria Plans: Change in Status and Changing Employee Elections

Posted by: Danielle Capilla    Jul 21, 2015 12:00:00 PM

Cafeteria plans, or plans governed by IRS Code Section 125, allow employers to help employees pay for expenses such as health insurance with pre-tax dollars. Employees are given a choice between a taxable benefit (cash) and two or more specified pre-tax qualified benefits, for example, health insurance. Employees are given the opportunity to select the benefits they want, just like an individual standing in the cafeteria line at lunch.

Read More

Topics: employee benefits, section 125 plans, PPACA Affordable Care Act, Danielle Capilla, cafeteria plan, IRS Code Section 125