[authors: Kathryn R. Paradise, David L. Woodard]
With year-end fast approaching, now is the time for plan sponsors to review their employee benefit plans to ensure that they have been updated for any changes in the law, that required notices have been distributed, and to take other actions required by December 31, 2012. Here are a few items that you should be thinking about as the weather turns cooler and the days grow shorter.
Summary of Benefits and Coverage (SBC) – Under the Affordable Care Act, group health plans are required to provide a four page summary of the benefits and coverage available under the plan. SBCs are required for the first open enrollment period beginning on or after September 23, 2012, so calendar year plans must comply during this fall’s open enrollment period. See our previous Alert on this issue.
W-2 Reporting – Beginning with W-2s for the 2012 calendar year (issued in January 2013), employers must report the cost of group health plan coverage under an employer-sponsored group health plan. See our previous Alert on this issue.
FSA Limits – Beginning January 1, 2013 for calendar year plans and the first day of the plan year that begins after December 31, 2012 for non-calendar year plans, the maximum salary reduction contribution to a health flexible spending arrangement (FSA) is $2,500. Plan sponsors have until December 31, 2014 to amend their documents, but the FSA must be operated to reflect the limit beginning on the first day of the plan year. See our previous Alert on this issue.
Participant Fee Disclosure Notice – Recent Department of Labor regulations now require new annual and quarterly participant fee disclosure notices. The first annual participant disclosure was due August 30, 2012, or, if later, 60 days after the first day of the plan year beginning after November 1, 2011. The first quarterly participant disclosure is due November 14, 2012 for calendar year plans or 45 days after the end of the quarter in which disclosure was required for non-calendar year plans. See our previous Alert on this issue.
Annual Safe Harbor Notice – Calendar-year safe harbor 401(k) plans are required to provide the annual safe-harbor notice at least 30 days but no more than 90 days before the beginning of the plan year.
Annual QDIA Notice – To take advantage of 404(c) protection from fiduciary risk when participants select among investment alternatives, plan sponsors must provide eligible employees with the Qualified Default Investment Alternative (QDIA) notice at least 30 days before the beginning of the plan year.
For questions regarding this Alert or if you need assistance in complying with these requirements, please contact one of Poyner Spruill’s Employee Benefits attorneys.