Law Makes Tax Breaks Equal for Parking & Transit Benefits
On December 18, 2015, the Consolidated Appropriations Act of 2016 was signed into law. Included was a permanent reinstatement of parity in transit and parking benefits. What this means is that effective on January 1, 2016, the monthly max tax exclusion for transit and parking plans will match: it will be $255. This is a $125 increase for qualified transit plans.
The provision also retroactively reinstated the parity for 2015. The monthly limit for 2015 transit plans changed from $130 to $250, retroactive to January 1, 2015.
IRS announces 2015 HSA limits
Maximum contributions to health savings accounts will jump slightly next year, the Internal Revenue Service announced. It will increase $50 for individuals and $100 for families. The agency said the maximum 2015 HSA contribution will be $3,350 for individuals with self-only coverage, up from $3,300 this year. For those with family coverage, the maximum contribution will be $6,650, up from $6,550.
San Francisco Bay area employers required to provide commuter benefits
The Metropolitan Transportation Commission and the Bay Area Air Quality Management District jointly launched the Bay Area Commuter Benefits Program to reduce greenhouse gas emissions and traffic congestion by encouraging employees to commute by means other than driving alone. The pilot program extends through December 2016 and requires employers with 50 or more full-time employees in the San Francisco Bay area to offer commuter benefits to their employees by September 30, 2014.
New IRS Guidance on Medical FSAs Answers Some Open Questions
The IRS Office of Chief Counsel recently released two memos that provide employers with helpful rules regarding medical flexible spending accounts (FSAs), including the impact of the new medical FSA carryover rule on HSA eligibility and the appropriate correction procedures for improper medical FSA payments.
IRS Guidance Provides Penalty Relief and Establishes Pilot Program for Late Filers of Form 5500
The Internal Revenue Service (IRS) issued Notice 2014-35 and Revenue Procedure 2014-32. Notice 2014-35 provides relief from certain IRS penalties for the late filing of a Form 5500 return. Revenue Procedure 2014-32 establishes a temporary relief program for the late filing of a Form 5500 return for non-Title I retirement plans.