PCORI Fees Due to IRS No Later Than July 31

Fees to fund the Patient-Centered Outcomes Research Institute (PCORI) are due to the IRS no later than July 31, 2017 from employers who sponsor certain self-insured health plans, including health reimbursement arrangements (HRAs) that are not treated as excepted benefits.

How to Pay PCORI Fees
Employers that sponsor certain self-insured health plans must report and pay the required PCORI fees via IRS Form 720, Quarterly Federal Excise Tax Return. For plan years ending between January 1, 2016 and September 30, 2016, the fee for an employer sponsoring an applicable self-insured plan is $2.17 multiplied by the average number of lives covered under the plan. For plan years ending between October 1, 2016 and December 31, 2016, the fee is $2.26 multiplied by the average number of lives covered under the plan.

For more information on PCORI fees, visit our PCORI Fees for Self-Insured Plans section.

2018 Health Savings Account Limits Released

The IRS has announced the 2018 inflation-adjusted amounts for Health Savings Accounts (HSAs).

Annual Contribution Limitation
For calendar year 2018, the annual limitation on HSA deductions for an individual with self-only coverage under a high deductible health plan is $3,450 (up from $3,400 for 2017). The annual limitation on HSA deductions for an individual with family coverage under a high deductible health plan is $6,900 (up from $6,750 for 2017).

High Deductible Health Plan Amounts
For calendar year 2018, a “high deductible health plan” is defined as a health plan with an annual deductible that is not less than $1,350 for self-only coverage or $2,700 for family coverage, and annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) that do not exceed $6,650 for self-only coverage or $13,300 for family coverage.

Click here to read the IRS announcement on these amounts.

Be sure to check out our Health Savings Accounts section for more on HSAs.

New OSHA Training Requirements Now Effective

Under the U.S. Occupational Safety and Health Administration’s (OSHA) recent General Industry Walking-Working Surfaces and Fall Protection Standards final rule, employers are now required to ensure that workers who use personal fall protection and equipment are trained about fall and equipment hazards, including fall protection systems.

New Training Requirements
Under the recent final rule, employers whose employees use personal fall protection equipment and work in other specified high hazard situations must provide employee training as to fall hazards, including fall protection systems. Specifically, employees must be trained by a qualified person and must be trained in at least the following topics:

• The nature of fall hazards in the work area and how to recognize them;
• The procedures to be followed to minimize those hazards;
• The correct procedures for installing, inspecting, operating, maintaining, and disassembling the personal fall protection systems that the employee uses; and
• The correct use of personal fall protection systems including, but not limited to, proper hook-up, anchoring, and tie-off techniques.

In addition, the final rule requires employers to train each employee on equipment hazards. This required training includes training as to the proper care, inspection, storage, and use of certain equipment (including, but not limited to, dockboards and rope descent systems) before an employee uses the equipment.

Both the fall and equipment hazard trainings must be presented to each employee in a manner that the employee understands. In addition, employers must retrain an employee when the employer has reason to believe the employee does not have the understanding and skill required by the initial training.

For additional information on the final rule and its training requirements, please click here.

To read more about worker safety and health, please visit our Safety & Wellness section.

IRS Offers Tips on Preparing for Natural Disasters

With hurricane season approaching, the IRS is offering advice to those impacted by storms and other natural disasters. The following tips may help businesses prepare for such events:

• Use electronic records. Businesses may have access to bank and other financial statements online. If so, their statements are already securely stored there. Businesses can also keep an additional set of records electronically by scanning tax records and insurance policies onto an electronic format. Businesses may also want to download important records to an external hard drive or USB flash drive.
• Document valuables. Take time- and date-stamped photos or videos of the contents of your business. These visual records can help prove the value of lost items, which can help with insurance claims or casualty loss deductions on a tax return. Businesses should store these records in a safe place.
• Contact the IRS for help. Businesses that fall victim to a disaster may call the IRS disaster hotline at 866-562-5227 for special help with disaster-related tax issues.
• Get copies of prior year tax records. If a business needs a copy of its tax return, it should file IRS Form 4506, Request for Copy of Tax Return. While the usual fee per copy is $50, the IRS is expected to waive this fee if a business is a victim of a federally declared disaster. For information that shows most line items from a tax return, call 1-800-908-9946 to request a free transcript. Alternatively, businesses may file IRS Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript, or IRS Form 4506-T, Request for Transcript of Tax Return.

The IRS offers many resources to help employers plan for and recover from disasters, including IRS Publication 584-B, Business Casualty, Disaster, and Theft Loss Workbook, and web pages devoted to preparing for a disaster and tax relief in disaster situations.

Visit our Planning for Workplace Emergencies section for more on how to protect your business from natural disasters.

Newsletter provided by:

Summit Insurance Advisors
11350 McCormick Road, Executive Plaza III,, Hunt Valley, MD 21031
(410) 584-9600
jb@sumfi.com
http://www.summitinsurnceadvisors.com

The content herein is provided for general information purposes only, and does not constitute, legal, tax, or other advice or opinions on any matters. This information has been taken from sources which we believe to be reliable, but there is no guarantee as to its accuracy.

© 2017 HR 360, Inc. – All rights reserved

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‘Pay or Play’ Penalty and Affordability Amounts Announced

The IRS has updated its existing Q&As on the Affordable Care Act’s employer shared responsibility (“pay or play”) requirements to reflect adjustments to the pay or play penalty and affordability amounts. Those adjustments are as follows:

• For calendar year 2017, the applicable per-employee dollar penalties of $2,000 and $3,000 are adjusted to $2,260 and $3,390, respectively.
• For plan years beginning in 2017, the affordability threshold for purposes of both the pay or play affordability safe harbors and the premium tax credit provisions is 9.69%.

The Q&As also address what counts as an “offer of coverage” for purposes of pay or play compliance. Click here to view the Q&As in their entirety. Check out our Pay or Play section for step-by-step guidance, worksheets, and calculators that can help employers understand whether they will be subject to a penalty, and how to calculate it.

Redesigned Green Cards Impact Form I-9 Compliance

U.S. Citizenship and Immigration Services (USCIS) has announced a redesign to the Permanent Resident Card (“Green Card”) and the Employment Authorization Document (“EAD”). USCIS is expected to begin issuing the new Green Cards and EADs on May 1, 2017.

Redesigned Green Cards The new Green Cards and EADs will:

• Display the individual’s photos on both sides;
• Show a unique graphic image and color palette:
  • Green Cards will have an image of the Statue of Liberty and a predominately green palette; and
  • EADs will have an image of a bald eagle and a predominately red palette;
• Have embedded holographic images; and
• No longer display the individual’s signature.

Also, Green Cards will no longer have an optical stripe on the back.

What Employers Need to Know Employers should be aware of the following regarding the redesigned Green Cards and EADs:

• Both the existing and the new versions of Green Cards and EADs remain acceptable for purposes of Form I-9 and E-Verify compliance.
• Both the existing and the new Green Cards and EADs will remain valid until the expiration date shown on the card.
• Some older Green Cards, which do not have an expiration date, remain valid.
• Certain EADs held by individuals with Temporary Protected Status and other designated categories have been automatically extended.
• Some Green Cards and EADs issued after May 1, 2017 may still display the existing design format, as USCIS will continue using existing card stock until current supplies are depleted.

Check out our section on Form I-9 for more information on complying with employment eligibility verification requirements.

Avoiding Employee Misclassification Under the FSLA

In order for the federal Fair Labor Standards Act’s (FLSA) minimum wage and overtime pay requirements to apply to a worker, the worker must be an “employee” of the employer, meaning that an employment relationship must exist between the worker and the employer. The FLSA defines “employ” as including to “suffer or permit to work,” representing the broadest definition of employment under the law, as it covers work that the employer directs or allows to take place. Applying the FLSA’s definition, workers who are economically dependent on the business of the employer, regardless of skill level, are considered to be employees. On the other hand, independent contractors are workers with economic independence who are in business for themselves.

While the U.S. Department of Labor (DOL) finds that most workers are employees under the FLSA, in order to make the determination of whether a worker is an employee or an independent contractor, the DOL uses the multi-factor “economic realities” test, which focuses on whether the worker is economically dependent on the employer or in business for him or herself. Each factor of the “economic realities” test is outlined below.

• Is the Work an Integral Part of the Employer’s Business? If the work performed by a worker is integral to the employer’s business, it is more likely that the worker is economically dependent on the employer. A true independent contractor’s work, on the other hand, is unlikely to be integral to the employer’s business.
• Does the Worker’s Managerial Skill Affect the Worker’s Opportunity for Profit or Loss? This factor should not focus on the worker’s ability to work more hours, but rather on whether the worker exercises managerial skills and whether those skills affect the worker’s opportunity for both profit and loss.
• How Does the Worker’s Relative Investment Compare to the Employer’s Investment? The worker should make some investment (and therefore undertake at least some risk for a loss) in order for there to be an indication that he or she is involved in an independent business. The worker’s investment should not be relatively minor compared with that of the employer. If the worker’s investment is relatively minor, that suggests that the worker and the employer are not on similar footings and that the worker may be economically dependent on the employer.
• Does the Work Performed Require Special Skill and Initiative? A worker’s business skills, judgment, and initiative, not his or her technical skills, will aid in determining whether the worker is economically independent.
• Is the Relationship Between the Worker and the Employer Permanent or Indefinite? Permanency or indefiniteness in the worker’s relationship with the employer suggests that the worker is an employee. However, a lack of permanence or indefiniteness does not automatically suggest an independent contractor relationship. The key is whether the lack of permanence or indefiniteness is due to operational characteristics intrinsic to the industry or the worker’s own business initiative.
• What is the Nature and Degree of the Employer’s Control? The employer’s control should be analyzed in light of the ultimate determination of whether the worker is economically dependent on the employer or truly an independent businessperson. The worker must control meaningful aspects of the work performed such that it is possible to view the worker as a person conducting his or her own business.

Our Independent Contractors section includes more information on how to correctly determine worker classification.

President Trump Signs Repeal of OSHA’s “Volks Rule”

President Trump has signed into law House Joint Resolution 83, which repeals the “Volks Rule,” a U.S. Occupational Safety and Health Administration (OSHA) rule which imposed on employers certain continuing obligations to make and maintain accurate records of recordable injuries and illnesses. The rule previously became effective on January 18, 2017

OSHA Recordkeeping Regulations OSHA’s recordkeeping regulations require employers to record information about certain work-related injuries and illnesses on an OSHA 300 Log. Employers must enter each recordable injury or illness on the OSHA 300 Log, as well as on a supplementary OSHA 301 Incident Report, within 7 calendar days of receiving information that a recordable injury or illness has occurred. At the end of each calendar year, employers must create, certify, and post annual summaries of the cases listed on their 300 Logs for the prior calendar year. Generally, employers must retain their OSHA Logs, Incident Reports, and annual summaries for 5 years following the end of the calendar year that they cover.

If an employer initially fails to record a recordable injury or illness on the OSHA 300 Log or the corresponding OSHA 301 Incident Report, the employer still has an ongoing duty to record that case; as long as an employer fails to comply with the ongoing recording duty, there exists an ongoing violation of OSHA’s recordkeeping requirements. OSHA can cite employers for such recordkeeping violations for up to 6 months after the 5-year retention period expires.

‘Volks Rule’ Explained OSHA’s “Volks Rule,” which became effective on January 18, 2017, amended OSHA’s recordkeeping regulations to state that:

• If an employer failed to record an injury or illness within 7 days, the obligation to record continued on past the 7th day, such that each successive day where the injury or illness remained unrecorded constituted a continuing “occurrence” of the ongoing violation.
• Under the rule, an employer could not avoid the five-year maintenance requirement by failing to make the record in the initial 7 days; rather, the obligation to make the record, for both the OSHA 300 Log as well as the OSHA 301 Incident Report, continued throughout the 5-year maintenance period even if the employer failed to meet its initial obligation.

‘Volks Rule’ Repealed On April 3, 2017, President Trump signed into law House Joint Resolution 83 (H.J. Res. 83), which declares the “Volks Rule” to no longer have force or effect.

To read more about worker safety and health, please visit our section on Safety & Wellness.

Firing a Problem Employee

Firing an employee is never easy. As unpleasant as any layoff or termination situation is, however, handling one with a problem employee makes the task even more challenging. Check out our Discipline & Termination section for more helpful tips.

Newsletter provided by:

Summit Insurance Advisors
11350 McCormick Road, Executive Plaza III,, Hunt Valley, MD 21031
(410) 584-9600
jb@sumfi.com
http://www.summitinsurnceadvisors.com

Please Note: The information and materials herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, plan provider or other professional advisor. This information has been taken from sources which we believe to be reliable, but there is no guarantee as to its accuracy. In accordance with IRS Circular 230, this communication is not intended or written to be used, and cannot be used as or considered a ‘covered opinion’ or other written tax advice and should not be relied upon for any purpose other than its intended purpose.

The information provided herein is intended solely for the use of our clients and members. You may not display, reproduce, copy, modify, license, sell or disseminate in any manner any information included herein, without the express permission of the Publisher. Kindly read our Terms of Use and respect our Copyright.

© 2017 HR 360, Inc. – All rights reserved

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How to Correct Form 1094 & 1095 Errors

To avoid potential noncompliance penalties, employers should confirm the accuracy of all Affordable Care Act (ACA) information returns and correct any errors as soon as possible with both the IRS and their employees.   Errors on Forms 1094-C and 1095-C Forms 1094-C and 1095-C are used by applicable large employers to satisfy their reporting obligations. To correct information on the paper version of the original Authoritative Transmittal Form 1094-C, employers should take the following steps:

• Prepare a new authoritative Form 1094-C including the correct information
• Enter an “X” in the CORRECTED checkbox at the top of the form
• File the standalone corrected authoritative Form 1094-C with the IRS

If correcting information on the paper version of a Form 1095-C that was previously filed with the IRS, employers should:

• Prepare a new Form 1095-C
• Enter an “X” in the CORRECTED checkbox at the top of the form
• File the corrected Form 1095-C, along with a non-authoritative Form 1094-C (DO NOT mark the CORRECTED checkbox on the Form 1094-C), with the IRS
• Furnish the employee a copy of the corrected Form 1095-C (note that different rules apply for an employer that is eligible to use the Qualifying Offer Method)

For more information on correcting errors on Forms 1094-C and 1095-C, see the 2016 Instructions for Forms 1094-C and 1095-C. Section 7.1 of Publication 5165 provides instructions for making corrections to Forms 1094-C and 1095-C filed electronically.   Errors on Forms 1094-B and 1095-B Forms 1094-B and 1095-B are used by self-insuring employers that are not considered applicable large employers, and by other parties that provide minimum essential health coverage. If a Form 1095-B filed with the IRS on paper contains an error, the employer should file a corrected return as follows:

• Fully complete a new Form 1095-B
• Enter an “X” in the CORRECTED checkbox at the top of the form
• File the corrected Form 1095-B, along with a transmittal Form 1094-B, with the IRS
• Furnish a copy of the corrected Form 1095-B to the person identified as the responsible individual

For more information on correcting errors on Forms 1094-B and 1095-B, see the 2016 Instructions for Forms 1094-B and 1095-B. Section 7.1 of Publication 5165 provides instructions for making a correction to Forms 1095-B filed electronically.   For more on employer information reporting requirements, check out our section on Information Reporting.

2017 Values for Employer-Provided Vehicles Released

The IRS has released the maximum vehicle values for 2017 that taxpayers need to determine the value of personal use of employer-provided vehicles under the IRS’s special valuation rules.   2017 Maximum Vehicle Values

• The maximum value of employer-provided vehicles first made available to employees for personal use in calendar year 2017, for which the vehicle cents-per-mile valuation rule provided under IRS Regulation section 1.61–21(e) may be applicable, is $15,900 for a passenger automobile, and $17,800 for a truck or van.
• The maximum value of employer-provided vehicles first made available to employees for personal use in calendar year 2017, for which the fleet-average valuation rule provided under IRS Regulation section 1.61–21(d) may be applicable, is $21,100 for a passenger automobile, and $23,300 for a truck or van.

Click here to read the IRS release on the 2017 maximum vehicle values.   To learn more about the tax consequences of various employer-provided fringe benefits, visit our Fringe Benefits section.

USCIS Updates Form I-9 Handbook

U.S. Citizenship and Immigration Services (USCIS) has released an updated M-274, Handbook for Employers, which provides guidance for complying with the requirements of Form I-9, Employment Eligibility Verification.   Updated Handbook Among other things, the updated handbook provides information and answers on the following topics:

• Completing Form I-9;
• Retaining Form I-9;
• Acceptable documents for verifying employment authorization and identity; and
• Unlawful discrimination and penalties for prohibited practices.

Click here to access the updated handbook.   For more information on complying with employment eligibility verification requirements, please visit our section on Form I-9.

3 Tax Recordkeeping Tips for Employers

Keeping good records not only makes tax filing easier and faster, but it can also help you monitor the progress of your business, prepare your financial statements, and support items reported on your tax returns. Here are three simple tips from the IRS to help you get organized: 1. Save Certain Business Records The following are some of the types of records you should keep:

• Gross receipts are the income you receive from your business. You should keep supporting documents that show the amounts and sources of your gross receipts.
• Purchases are the items you buy and resell to customers. Your supporting documents should show the amount paid and that the amount was for purchases.
• Expenses are the costs you incur (other than purchases) to carry on your business. Your supporting documents should show the amount paid and a description showing that the amount was for a business expense.
• Assets are the property, such as machinery and furniture, that you own and use in your business. You need records to compute the annual depreciation and the gain or loss when you sell the assets.

2. Keep Employment Tax Records The following information should be available for IRS review:

• Your employer identification number (EIN);
• Amounts and dates of all wage, annuity, and pension payments;
• Amounts of tips reported;
• The fair market value of in-kind wages paid;
• Names, addresses, social security numbers, and occupations of employees and recipients;
• Any employee copies of Forms W-2 that were returned to you as undeliverable;
• Dates of employment;
• Periods for which employees and recipients were paid while absent due to sickness or injury and the amount and weekly rate of payments you or third-party payers made to them;
• Copies of employees’ and recipients’ income tax withholding allowance certificates;
• Dates and amounts of tax deposits you made;
• Copies of returns filed;
• Records of allocated tips; and
• Records of fringe benefits provided, including substantiation.

3. Store and Organize Your Records Business owners should generally keep all employment-related tax records for at least 4 years after the date that the tax becomes due, or after the tax is paid, whichever is later. The length of time you should keep other documents depends on the action, expense, or event which the document records.   You can review our section on Employee Records and Files for information on other federal recordkeeping responsibilities for employers.

Hiring and Managing Seasonal Employees

With the summer hiring season approaching, employers should begin thinking about how best to hire and manage seasonal employees. Employers who do not dedicate time to these critical steps risk having to face disgruntled employees, unhappy customers, and even legal violations. To learn some best practices for hiring and managing seasonal employees, please watch the video below.

To learn how to attract top talent to your company, check out our Recruitment & Hiring section.

Newsletter provided by:

Summit Insurance Advisors 11350 McCormick Road, Executive Plaza III,, Hunt Valley, MD 21031 (410) 584-9600 jb@sumfi.com http://www.summitinsurnceadvisors.com

Please Note: The information and materials herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, plan provider or other professional advisor. This information has been taken from sources which we believe to be reliable, but there is no guarantee as to its accuracy. In accordance with IRS Circular 230, this communication is not intended or written to be used, and cannot be used as or considered a ‘covered opinion’ or other written tax advice and should not be relied upon for any purpose other than its intended purpose.

The information provided herein is intended solely for the use of our clients and members. You may not display, reproduce, copy, modify, license, sell or disseminate in any manner any information included herein, without the express permission of the Publisher. Kindly read our Terms of Use and respect our Copyright.

© 2017 HR 360, Inc. – All rights reserved

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Handling Employee Attendance During Bad Weather

Snow and slippery conditions during the winter months may make it difficult for your employees to travel to work. Consider the following guidelines that can help your company be prepared when bad weather strikes.

1. When an employee misses work due to bad weather conditions, whether the employee is entitled to be paid for the absence may depend on the employee’s exempt or non-exempt status.

• Under the federal Fair Labor Standards Act (FLSA), employers are not required to pay non-exempt employees for hours they did not work, including when the office is closed due to bad weather.
• Exempt employees generally must be paid their full salary amount if they perform any work during a workweek. However, an employer that remains open for business during a period of bad weather may generally make deductions, for full-day absences only, from the salary of an exempt employee who chooses not to report to work because of the weather. Deductions from salary for less than a full-day’s absence are not permitted.
  • Note: If the business is closed for the day as a result of inclement weather, the employer may not deduct the day’s pay from the salary of an exempt employee. The general rule is that an employer who closes operations due to a weather-related emergency or other disaster for less than a full workweek must pay an exempt employee the full salary for that week, if the employee performs any work during the week. This is because deductions may not be made for time when work is not available.

2. Some states require employers to pay employees for showing up even if no work is available or there is an interruption of work and the employee is sent home.

• Although payment for time not worked may not be required for non-exempt employees under federal law, some states do require that employees be paid for a minimum number of hours for reporting to work, even if there is no work that can be performed (such as when the office is closed) or the employee is sent home early, for instance, due to an impending storm.
• Often called “reporting time pay,” these laws may apply to specific industries (e.g., manufacturing) or certain employees only, so it is important to check with your state labor department for requirements that may apply to your company before implementing any policy.

3. Plan ahead to let your employees know what is expected of them and to help minimize disruption to your business.

• Make it a priority to notify all of your employees, both exempt and non-exempt, of your company’s policy regarding employee attendance and pay during periods of inclement weather. Your policy should include information on how your employees can find out whether the office is open or closed, such as by email, radio broadcast, calling in to hear a recorded message, or other methods that all employees can access. Be sure to apply your policy consistently and fairly to all employees.
• It’s also prudent to remind employees to use their best judgment and not to put their safety at risk when it comes to traveling to work during or after a storm. If possible, see if you can arrange for employees to work remotely from home on days when the weather makes travel dangerous.

For more issues related to employee compensation, including guidelines for determining the exempt or non-exempt status of your employees, visit our section on Employee Pay.

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