Understanding Employee Benefits and key developments in the employee benefits field and items of interest to our clients. MORE

The Department of Health and Human Services’ (“HHS”) Office for Civil Rights recently published a final rule (the “Final Rule“) which provides additional privacy protections related to the use and disclosure of reproductive health care information.  Covered entities (e.g., health plans) and their business associates must comply with all of the provisions of the Final Rule by December 22, 2024, except for the requirement to update their Notice of Privacy Practices, which must be updated by February 16, 2026.

At a high level, the Final Rule amended the privacy regulations promulgated under HIPAA (the “Privacy Rule”) to:

  • Prohibit the use or disclosure of protected health information (“PHI”) when it is requested to identify, investigate, or impose liability on individuals who seek, obtain, provide, or facilitate reproductive health care that is lawful under the circumstances in which the health care is provided;
  • Require that covered entities and business associates obtain a valid attestation from the person or entity requesting PHI that is potentially related to reproductive health care if the request is for: (a) health care activities, (b) judicial and administrative proceedings, (c) law enforcement purposes, and (d) disclosures to coroners and medical examiners; and
  • Require covered entities to modify their Notice of Privacy Practices to implement the changes made to reproductive health care privacy.

Below are a few important takeaways related to the Final Rule:

Presumption of Lawful Health Care – Reproductive health care is presumed to be lawful unless the covered entity or business associate either (a) has actual knowledge that the care was unlawful, or (b) receives information from the person requesting the use or disclosure of PHI and the information provides a substantial factual basis that the care was unlawful.

Attestation Requirement – The attestation may not be combined with any other document. While covered entities and business associates can develop their own attestation form, the HHS has indicated that it will publish a model attestation form prior to the compliance date.

Compliance Considerations for Covered Entities and Business Associates – If you are a covered entity or business associate, you should take the following steps to remain HIPAA compliant after the Final Rule’s compliance dates:

  • HIPAA Policies and Procedures:  You should review and update your HIPAA policies and procedures regarding the use and disclosure of PHI related to reproductive health care.
  • Attestation:  You should develop an attestation form, or use the HHS’s model attestation form, which should be published prior to the compliance date.
  • Workforce Training:  You should update workforce training materials and provide workforce training to describe the limitations on the use and disclosure of PHI related to reproductive health care and the new attestation requirement.
  • Notice of Privacy Practices:  You should update the Notice of Privacy Practices to include the new Final Rule requirements no later than February 16, 2026.  

 Please contact Lisa Rippey or Tom Dowling if you have any questions about the Final Rule or what impact it may have on your group health plan.

On November 1, 2023, the Internal Revenue Service (IRS) released Notice 2023-75, which sets forth the 2024 cost-of-living adjustments affecting dollar limits on benefits and contributions for qualified retirement plans. The IRS also announced the health savings account (HSA) and high deductible health plan (HDHP) annual deductible and out-of-pocket expense adjustments earlier this year in Revenue Procedure 2023-23 and the health flexible spending arrangement (Medical FSA) adjustments in Revenue Procedure 2023-34. Finally, the Social Security Administration announced its cost-of-living adjustments for 2024 on October 12, 2023, which includes a change to the taxable wage base.

The following chart summarizes the 2024 limits for benefit plans. The 2023 limits are provided for reference.

 20232024
Elective Deferral Limit 401(k), 403(b), 457(b)$22,500$23,000
Catch-up Limit (age 50+)$7,500$7,500
Defined Benefit Limit$265,000$275,000
Defined Contribution Limit$66,000$69,000
Dollar Limit – Highly Compensated Employees$150,000$155,000
Officer – Key Employee$215,000$220,000
Annual Compensation Limit$330,000$345,000
SEP Eligibility Compensation Limit$750$750
SIMPLE Deferral Limit$15,500$16,000
SIMPLE Catch-up Limit (age 50+)$3,500$3,500
Social Security Taxable Wage Base$160,200$168,600
ESOP 5 Year Distribution Extension Account Minimum$1,330,000$1,380,000
Additional Amount for 1-Year Extension$265,000$275,000
HSA (Self/Family) Maximum Annual Contribution$3,850/$7,750$4,150/$8,300
HDHP (Self/Family) Minimum Deductible Limits$1,500/$3,000$1,600/$3,200
Out-of-pocket Expense Annual Maximum  $7,500/$15,000    $8,050/$16,100
Medical FSA$3,050$3,200
Maximum Medical FSA Carryover to Next Plan Year$610$640

For more information on the 2024 cost-of-living adjustments, please contact Lisa Rippey, Sam Butler, or the Stinson LLP contact with whom you regularly work.

As signed into law, Section 603 of the SECURE 2.0 Act of 2022 (“SECURE 2.0”) required that effective as of January 1, 2024, participants in 401(k) plans, 403(b) plans, or governmental 457(b) plans, who were age 50 or older and whose Social Security wages for the previous year exceed $145,000 (indexed), only be permitted to make catch-up contributions under such plans on a Roth (after-tax) basis.  This requirement of SECURE 2.0 has raised a number of legal and plan administration concerns among plan sponsors and retirement plan service providers.

On the legal side, plan sponsors were concerned that plans that did not offer Roth contributions would have to cease allowing older workers to make catch-up contributions effective as of January 1, 2024.  This concern stemmed from language in Section 603 that required all plan participants to have the option to make catch-up contributions on a Roth basis if any plan participant is required to make their catch-up contributions on a Roth basis.  Consequently, in order to comply with the requirements of SECURE 2.0, sponsors of plans which do not permit Roth contributions would have to either begin allowing Roth contributions effective January 1, 2024, or eliminate the ability of older participants to make catch-up contributions to the plan.  In addition, an apparent drafting error in SECURE 2.0 can be read as eliminating the ability to allow catch-up contributions from the Internal Revenue Code.

On the administrative side, plan service providers and plan sponsors have struggled to design systems to timely and accurately identify those plan participants who would be required to make catch-up contributions on a Roth-only basis.  Appropriately identifying those workers limited to Roth catch-up contributions would typically require the sharing of data between retirement plan recordkeepers and the plan sponsor’s payroll provider.  Service providers and plan sponsors have expressed concern that coordinating information sharing among all the affected parties would not be possible by January 1, 2024.

In response to these concerns, the IRS issued Notice 2023-62 on August 25, 2023.  In this notice the IRS announced transition relief that will give plan sponsors and plan service providers additional time to prepare for the implementation of Section 603 of SECURE 2.0.  The transition relief provides, among other things, that:

  •  As anticipated, SECURE 2.0 does not prohibit plans from offering catch-up contributions;
  • Until January 1, 2026, retirement plans that: (i) allow participants who are age 50 or older and had wages in excess of $145,000 (indexed) in the previous year to make catch-up contributions on a pre-tax basis or (ii) do not provide for designated Roth contributions; will be treated as satisfying the requirements of Section 603 of SECURE 2.0; and
  • The Treasury Department and IRS intend to release additional guidance with respect to Section 603 of SECURE 2.0, providing that: (i) plan participants who do not have wages for purposes of FICA for the preceding calendar year (e.g., partners, self-employed individuals, and certain governmental employees) are not subject to the requirement to make catch-up contributions on a Roth basis; (ii) plan sponsors may treat an election to make catch-up contributions on a pre-tax basis by a plan participant required to make catch-up contributions on a Roth basis pursuant to Section 603 of SECURE 2.0 as an election to make such contributions on a Roth basis; and (iii) in the case of multiple employer and multiemployer plans, Section 603 of SECURE 2.0 would not require  unrelated employers to aggregate the wages of plan participants to determine which participants are limited to making only Roth catch-up contributions.

In addition to providing a preview of future guidance, Notice 2023-62 also requests comments on whether future guidance should address plans that allow catch-up contributions, but do not include a qualified Roth contribution program. Plan sponsors are not required to take any action in response to Notice 2023-62; but, plan sponsors that were contemplating adding Roth contributions to their plans effective January 1, 2024, in order to comply with Section 603 of SECURE 2.0 may want to revisit those plans.  If you have any additional questions regarding the impact of Notice 2023-62 on your retirement plans, please reach out to a member of Stinson’s employee benefits and executive compensation practice group.

As explained in part I of our Preparing for the End of the COVID-19 Emergency Declaration series, the Public Health Emergency (“PHE”) and National Emergency (“NE”) are coming to a close.  While the Biden Administration had initially announced its intent to end the NE on May 11, 2023, on April 10, 2023, President Biden signed a bill into law that immediately terminated the NE.  The PHE, however, is still set to expire on May 11, 2023. The end of the NE and PHE will have significant impacts on group health plans. Part II of our series will focus on how the expiration of the Emergency Declarations will change the COVID-19 vaccination coverage requirements currently in place and what plan sponsors should do in anticipation of such change.

Under Section 3203 of the CARES Act, most group health plans are required to cover any qualifying coronavirus preventive service (“COVID Preventive Service”) without cost-sharing (including deductibles and copays or coinsurance) pursuant to Section 2713 of the Public Health Service Act. A “qualifying coronavirus preventive service” is an item, service, or immunization that is intended to prevent or mitigate COVID-19, and that is:

  • An evidence-based item or service with an A or B rating recommended by the United States Preventive Services Task Force (“USPSTF”); or
  • an immunization for routine use for children, adolescents, or adults recommended by the Advisory Committee on Immunization Practices (“ACIP”) of the Center for Disease Control and Prevention. 

Both the USPSTF and the ACIP have included COVID-19 vaccines on their lists of recommended immunizations. 

In its November 6, 2020 interim final rules, the DOL required that, during the PHE, group health plans cover any COVID Preventive Service without cost-sharing, regardless of whether the services are provided by an in-network or out-of-network provider.  Recent guidance issued by the Agencies on March 29, 2023, clarifies that after the PHE expires, most non-grandfathered group health plans will still be required to provide in-network COVID Preventive Services (which includes COVID-19 vaccines) without cost-sharing. After the PHE, group health plans are not required to provide benefits for COVID Preventive Services delivered by an out-of-network provider if the plan has a network of providers who can provide the applicable COVID Preventive Service. 

It is important to note that on March 30, 2023, the District Court of Texas in Braidwood Management v. Becerra, struck down part of the ACA’s coverage requirement for preventive services.  The ruling blocked the federal government from requiring group health plans to cover services recommended or updated by the USPSTF. However, the portion of the ACA requiring group health plans to cover services recommended or updated under the ACIP remains intact. Therefore, because the COVID-19 vaccine has been recommended by the ACIP, first-dollar coverage of COVID-19 vaccines is still required for in-network and out-of-network coverage during the PHE and for in-network coverage post-PHE.       

In light of the end of the PHE, group health plan sponsors should consider the following with respect to COVID-19 vaccination coverage:

  • Whether the group health plan will continue to cover out-of-network COVID-19 vaccines at no cost, or at all. Insured plans should reach out to their insurers to confirm what the insurer has decided to cover. Self-insured plans should work with their third party administrators to determine what coverage options are available after the end of the PHE.
  • Whether a plan amendment or participant notice is required. Plan sponsors will need to ensure plan documents, summary plan descriptions and other participant communications accurately reflect what type of coverage is available, if any, for out-of-network COVID-19 vaccines after the PHE. Group health plans may need to be amended, depending on the language used in the plan and whether the out-of-network COVID-19 vaccine coverage changes. Similarly, participant notice may also be required, depending on the plan sponsor’s coverage choice.

Please contact Nick Bertron, Sam Butler, Audrey Fenske, Lisa Rippey, or Stephanie Schmid if you have questions about the expiration of the COVID-19 Emergency Declarations and any impact it may have on your group health plan.

On January 30, 2023, the Biden Administration announced that it intends for the National Emergency (“NE”) relating to the COVID-19 pandemic to end on May 11, 2023. Shortly after, the Secretary of the Department of Health and Human Services announced the intent to end the Public Health Emergency (“PHE”) on the same day. The end of the NE and PHE will have significant impacts on group health plans. In the coming weeks, Stinson’s Employee Benefits Practice Group will be issuing several alerts describing these impacts and outlining considerations and action items for plan sponsors to take before the end of the PHE and NE. This is the first in the series of alerts.

During the PHE, most group health plans are required to cover certain items and services related to diagnostic testing for COVID-19 without cost-sharing (including deductibles and copays or coinsurance), prior authorization, or other medical management requirements. In January 2022, the Departments of Labor, Health and Human Services, and Treasury (the “Agencies”) issued guidance expanding this required coverage to over-the-counter COVID-19 tests.

The COVID-19 diagnostic testing coverage mandate ends with the expiration of the PHE. Group health plan sponsors will need to consider the following:

  • Whether the group health plan will continue to cover all COVID-19 diagnostic testing, and if so, whether cost-sharing requirements will apply. The Agencies issued guidance on March 29, 2023, encouraging plans and issuers to continue providing coverage of COVID-19 testing, without cost-sharing after the PHE ends. Insured plans should reach out to their insurers to confirm what the insurer has decided to cover. Self-insured plans should work with their third party administrators to determine what coverage options are available after the end of the PHE.
  • Whether a plan amendment or participant notice is required. Plan sponsors will need to ensure plan documents, summary plan descriptions and other participant communications accurately reflect whether COVID-19 diagnostic testing coverage will continue. Group health plans may need to be amended, depending on the language used in the plan and whether coverage will continue. Similarly, participant notice may also be required, depending on language used to notify the participant of the change in coverage.

The recent guidance issued by the Agencies on March 29, 2023, encourages plans to notify participants about key information relating to COVID-19 diagnosis and treatment coverage, such as the date coverage will end or the date cost-sharing will be imposed, as applicable. Accordingly, even if participants were previously provided notice, plan sponsors should consider communicating any changes to participants, who may not be aware that the PHE is ending.

Please contact Nick Bertron, Sam Butler, Lisa Rippey, or Stephanie Schmid if you have questions about the expiration of the COVID-19 Emergency Declarations and any impact it may have on your group health plan.

On December 23, 2022, the Departments of Labor, Health and Human Services and Treasury (the “Departments”) issued FAQs providing relief from prescription drug and health care spending reporting requirements. The FAQs are available here: https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/faqs/aca-part-56.

As part of the Consolidated Appropriations Act, 2021, group health plans and issuers must annually report to the Departments certain prescription drug and health care information, including but not limited to the:

  • 50 most frequently dispensed brand prescription drugs and the total number of paid claims for each such drug;
  • 50 most costly prescription drugs by total annual spending, and the annual amount spent by the plan or coverage for each such drug;
  • 50 prescription drugs with the greatest increase in plan or coverage expenditures from the previous plan year;
  • total spending on health care services by the plan or coverage broken down by the type of costs; and
  • impact on premiums and out of pocket costs from rebates, fees, and any other remuneration paid by drug manufacturers to the plan or its administrators or service providers, including the amount paid for therapeutic classes of drugs and amounts paid for each of the 25 drugs that yield the highest amounts of rebates and other remuneration from drug manufactures during the plan year. 

According to the FAQs, the Departments will not take enforcement action against a plan or issuer that uses a good faith, reasonable interpretation of the regulations and reporting instructions. In addition, plans and issuers now have until January 31, 2023 to provide a good faith submission of 2020 and 2021 data through the Health Insurance Oversight System. The deadline for 2020 and 2021 submissions were previously December 27, 2022.

The prescription drug and health care spending reporting obligation falls on the group health plan. Insured plans may satisfy the reporting requirements by entering into a contract with the carrier to provide the required information. If the carrier fails to meet the reporting requirements, the carrier, not the insured plan, violates the reporting obligations. Self-insured plans, on the other hand, cannot contract around the reporting obligations. While a self-insured plan may contract with a third-party to report the data, if the third-party fails to do so, the self-insured plan is ultimately liable for the reporting failure. 

Plan sponsors should continue working with their service providers to ensure required reporting for 2020 and 2021 is completed by the January 31, 2023 deadline. The Departments indicated they will continue to monitor stakeholder efforts to comply with reporting requirements to determine whether additional guidance is needed before future submission deadlines.  The deadline for submitting 2022 prescription and health care spending data is June 1, 2023.  

Recently Congress passed the Consolidated Appropriations Act of 2023 (“2023 CAA”). Among other things, the 2023 CAA extends, for a second time, the telehealth relief provided under the CARES Act. The CARES Act permitted high deductible health plans (“HDHP”) to provide first-dollar telehealth services or other remote care services. This allowed individuals covered under a HDHP that waived the deductible for telehealth services or other remote care to maintain HSA eligibility.  Under the CARES Act, this relief was available for plan years beginning on or before December 31, 2021, meaning the relief expired for calendar year plans at the end of 2021. The Consolidated Appropriations Act of 2022 extended the telehealth relief for the months of April 2022 through December 2022.

Under the 2023 CCA, HDHPs may, but are not required to, continue to provide first-dollar telehealth and other remote services for plan years beginning after December 31, 2022 and before January 1, 2025, without running afoul of the HSA eligibility rules (“Extended Telehealth Relief”). In other words, this relief is available for the 2023 and 2024 plan years if the plan has a calendar plan year.  However, if a plan has a non-calendar plan year, the Extended Telehealth Relief will not be available from January 1, 2023 until the first day of the plan year which begins in 2023 (the “Gap Period”). If the plan does not impose the minimum deductible for telehealth or other remote services during the Gap Period, the plan may not be a HDHP during the Gap Period, meaning that participants would be ineligible for HSA contributions during that period.

As mentioned above, the Extended Telehealth Relief is optional.  If a plan sponsor decides to implement the Extended Telehealth Relief, it should take the following steps:

  • If the HDPH is fully insured, the plan sponsor should contact its HDHP carrier to ascertain whether the carrier’s plans will adopt the Extended Telehealth Relief. If the Extended Telehealth Relief is adopted, the plan sponsor should also ensure that the changes are made to its plan documents and are communicated to HDHP participants.
  • If the HDHP is self-insured, the plan sponsor should consult with its stop-loss carrier and third party administrator regarding the Telehealth Relief Extension. It should also ensure that the changes are made in its plan documents and that HDHP participants are notified of such changes.

Revised January 11, 2023

Congress made several changes to retirement plans as part of the Consolidated Appropriations Act of 2023, which recently passed both the House and Senate. The final bill contains several provisions affecting retirement plans under Division T of the bill titled “Secure 2.0 Act of 2022.” An official summary of all of the provisions is available here. SECURE 2.0 builds on the Setting Every Community Up for Retirement Act (the “SECURE Act”), which passed in 2019.

Below is a high level summary of some of the key provisions that affect plan sponsors of retirement plans.

  • Increased Age for Required Beginning Date on Required Minimum Distributions. The age for required minimum distributions is increased to age 73 beginning on January 1, 2023, and further increased to age 75 on January 1, 2033.
  • Waiver of Required Minimum Distributions for Roth Accounts. The requirement of pre-death distributions from Roth designated accounts in an employer retirement plan are eliminated, effective for taxable years beginning after December 31, 2023.
  • Higher Catch-Up Limit at Ages 60-63. For plan years after December 31, 2024, the catch-up contribution limitation is increased to the greater of $10,000 or 50% of the regular catch-up contribution amount for individuals who have attained ages 60, 61, 62, and 63. Currently, the catch-up contribution amount is generally $7,500, so the provision would increase the catch-up contribution amount to $11,250. This increase is adjusted for inflation after 2025. Catch-up contributions will now be subject to Roth after-tax treatment for those earning more than $145,000 in the prior year.
  • Increase in Cash-out Limit.  Effective January 1, 2024, the Act increases the cash-out limit for involuntary distributions from $5,000 to $7,000.
  • Early Distributions for Emergency Expenses. Effective for distributions made after December 31, 2023, the 10% tax on early distributions does not apply for distributions related to certain emergency expenses (unforeseeable or immediate financial needs relating to personal or family emergency expenses). Participants would be allowed one distribution per year up to $1,000, and the employee would have the option to repay the distribution within 3 years. No further emergency distributions are permissible during the 3-year repayment period unless repayment occurs.
  • Early Distributions for Domestic Abuse Survivors. Effective for distributions made after December 31, 2023, the 10% tax on early distributions does not apply for distributions for domestic abuse survivors. The participant can self-certify that they have experienced domestic abuse, and can withdraw the lesser of $10,000 (indexed for inflation) or 50% of the participant’s account.
  • Saver’s Matching Contribution. Effective for tax years beginning after December 31, 2026, the Act replaces the existing tax credit for participant contributions to IRAs or retirement plans with a federal matching contribution that must be deposited into the taxpayer’s IRA or retirement plan. The match is 50% of the IRA or retirement plan contribution up to $2,000 per individual, and phases out between $41,000 and $71,000 for taxpayers filing a joint return ($20,500 to $35,500 for single taxpayers).
  • Improved Coverage for PartTime Workers. The SECURE Act added a requirement that employers needed to allow long-term part-time employees to participate in the 401(k) plan if the long-term part-time employee completes either 1 year of service at 1,000 hours or 3 consecutive years of service at 500 hours. The 3-year requirement is reduced to 2 years effective for plan years beginning after December 31, 2024. The 3-year requirement is still effective for plan years prior to the effective date.
  • Rainy Day Roth Accounts. In an effort to increase savings, employers may allow non-highly compensated employees to establish emergency savings accounts under qualified plans. Employers may automatically enroll employees into these accounts at no more than 3% of salary, and the amount is capped at $2,500. The contributions are made on a Roth-like basis, and are treated as elective deferrals for purposes of matching contributions with an annual cap set at the maximum account balance. Generally, withdrawals from the account are not subject to any fees or charges on the basis of the withdrawal. On separation from service, employees may cash out the savings accounts or roll it into a Roth IRA or other defined contribution plan.
  • Retirement Savings Lost and Found. The Department of Labor will create a national online searchable lost and found database for Americans’ retirement plan accounts. The Act directs the Department of Labor to create the database no later than 2 years after the enactment of the Act.
  • Expansion of EPCRS and Recover of Retirement Plan Overpayments. The Act directs the IRS to update the Employee Plans Compliance Resolution System (“EPCRS”) to, among other things, allow for more types of errors to be corrected under the self-correction program and to exempt certain failures to make required minimum distributions from the excise tax. The Act also gives plan fiduciaries latitude to decide not to recoup overpayments that were mistakenly made to retirees, and, if the fiduciaries choose to recoup overpayments, certain limitations and protections are put in place to safeguard innocent retirees.
  • Optional Employer Roth Contributions. The Act allows employers to make employer matching or non-elective contributions on a Roth basis, effective on the date of the Act.
  • Student Loan Payment Matching Contributions. The Act allows employers to make matching contributions to retirement plans based on employees’ student loan payments, effective January 1, 2024.
  • Enhanced Investments in 403(b) Plans. The Act amends the Internal Revenue Code to allow 403(b) custodial accounts to participate in group/collective investment trusts with other tax-preferred savings plans and IRAs, effective as of the date of the Act. However, even with this change, collective investment trusts are still effectively unavailable to most 403(b) plans until amendments are made to securities laws.
  • Pooled Employer 403(b) Plans. The Act expanded the pooled employer plan concept from the SECURE Act to 403(b) plans, and directs the Department of Treasury to issue regulations providing relief from the “one bad apple” rule for 403(b) plans.
  • Mandatory Automatic Enrollment in New 401(k) & 403(b) Plans. Effective for plan years beginning after December 31, 2024, any new 401(k) or 403(b) plan are required to automatically enroll participants upon becoming eligible (and the employees may opt out of coverage). The initial percentage must be at least 3% and no more than 10%, and is increased by 1% annually up to a plan-set maximum of at least 10% but no more than 15%. This requirement does not apply to current 401(k) and 403(b) plans, small businesses with 10 or fewer employees, new employers that have been in existence for fewer than 3 years, church plans, and governmental plans.

This is only a summary of some of the provisions in the Act that may affect plan sponsors. These changes will likely impact most retirement plans, so plan sponsors and administrators will need to monitor future developments from the Department of Treasury and the IRS. If you have specific questions on any of these provisions, contact the author or any member of the Stinson LLP Employee Benefits Group. Employee Benefits Practice: Stinson LLP Law Firm

On October 21, 2022, the Internal Revenue Service (IRS) released Notice 2022-55, which sets forth the 2023 cost-of-living adjustments affecting dollar limits on benefits and contributions for qualified retirement plans. Earlier this year, the health savings account (HSA) and high deductible health plan (HDHP) annual deductible and out-of-pocket expense adjustments were announced in Revenue Procedure 2022-24, and the health care FSA adjustments were announced in Revenue Procedure 2022-38. In addition, the Social Security Administration announced its cost-of-living adjustments for 2023 in October 2022, which includes a change to the taxable wage base.

The following chart summarizes the 2023 limits for benefit plans. The 2022 limits are provided for reference.

  2022 2023
Elective Deferral Limit 401(k), 403(b), 457(b) $20,500 $22,500
Catch-up Limit (age 50+) $6,500 $7,500
Defined Benefit Limit $245,000 $265,000
Defined Contribution Limit $61,000 $66,000
Dollar Limit – Highly Compensated Employees $135,000 $150,000
Officer – Key Employee $200,000 $215,000
Annual Compensation Limit $305,000 $330,000
SEP Eligibility Compensation Limit $650 $750
SIMPLE Deferral Limit $14,000 $15,500
SIMPLE Catch-up Limit (age 50+) $3,000 $3,500
Social Security Taxable Wage Base $147,000 $160,200
ESOP 5 Year Distribution Extension Account Minimum $1,230,000 $1,330,000
Additional Amount for 1-Year Extension $245,000 $265,000
HSA (Self/Family) Maximum Annual Contribution $3,650/$7,300 $3,850/$7,750
HDHP Minimum Deductible Limits $1,400/$2,800 $1,500/$3,000
Out-of-pocket Expense Annual Maximum $7,050/$14,100 $7,500/$15,000
Medical FSA Maximum Annual Contribution $2,850 $3,050

For more information on the 2023 cost-of-living adjustments, please contact Lisa Rippey, Jeff Cairns, or the Stinson LLP contact with whom you regularly work.

 

On August 3, 2022, the IRS published Notice 2022-33, which extends the deadlines for amending retirement plans and IRAs to reflect certain changes to the law made by the SECURE Act; the Bipartisan American Miners Act; and section 2203 (allowing waiver of 2020 required minimum distributions) of the CARES Act.  Before the IRS released Notice 2022-33, retirement plans with a calendar year plan year and IRAs generally were required to amend their plan documents to reflect those law changes by December 31, 2022 (although governmental plans and collectively bargains plans were subject to a later deadline); now, that deadline generally is December 31, 2025.  This new amendment deadline varies based on the type of retirement plan and the sponsor of such retirement plan.  The table below shows the original and revised amendment adoption deadlines for IRAs and various types of retirement plans.  Plan sponsors will notice that under Notice 2022-33, the amendment deadline for the applicable SECURE Act, Miners Act, and CARES Act provisions is the same.  The IRS anticipates that this will allow plan sponsors to adopt a single amendment that covers all three pieces of legislation, as applicable.

One key thing for the retirement plan sponsors to remember is that if they operationally implemented any of the other retirement plan provisions from the CARES Act, such as allowing coronavirus-related distributions or increasing the amount that participants could borrow from a retirement plan during 2020 or extending the repayment due date of plan loans outstanding during 2020, the deadline to adopt an amendment reflecting a retirement plan’s implementation of those provisions has not been extended by Notice 2022-33.  This means that sponsors of nongovernmental, calendar-year plans still have a December 31, 2022 deadline for those amendments.

The extended deadlines apply to both individually designed retirement plans and retirement plans using pre-approved plan documents.  Notice 2022-33 does not provide any relief for retirement plans that are terminated before the extended deadline – those plans are still required to be amended for all law changes in connection with their termination.  Nor did Notice 2022-33 extend the deadline for plan sponsors using pre-approved plan documents to adopt a cycle 3 restatement.  If a plan sponsor failed to adopt a cycle 3 restatement by July 31, 2022, it may correct this error using the IRS Voluntary Correction Program (“VCP”).

Please feel free to contact any member of Stinson’s Employee Benefits practice if you any questions about the deadline to amend a retirement plan or using VCP to correct a failure to timely adopt a cycle 3 restatement.

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