by admin | Nov 24, 2025 | Blog
If your business has fewer than 20 employees, you may qualify for COBRA’s small employer exception—but only if you count employees correctly. Missteps can lead to penalties and unexpected COBRA obligations.
Who Should You Count?
- All Employees, Not Just Plan Participants
Include everyone working for all employers maintaining the plan.
- Only Common-Law Employees
Exclude independent contractors and board members unless they meet IRS common-law criteria.
- Part-Time Employees as Fractions
Count based on hours worked compared to full-time status.
- Employees of Related Entities
Controlled group rules require counting employees of related companies and successors.
- Employees Outside the U.S.
Foreign entities and overseas employees count if part of the controlled group.
Why It Matters
Incorrectly applying the exception can result in lawsuits, penalties, and COBRA coverage obligations. When in doubt, consult a benefits expert.
Tip: Use a consistent counting method for the entire year and verify controlled group relationships.
Source: Thomson Reuters
by admin | Nov 18, 2025 | Job Opening
Position Title: Operational Account Manager
Position Classification: Full-time, Non-Exempt
Position Summary: Operational Account Managers serve as the backend processing team for the department. They Processes eligibility files, contribution files, and change files for groups that elect this method of transmission. Operational Account Managers oversee all aspects of banking setup and changes loaded in the platform for existing and
new client accounts.
by admin | Oct 30, 2025 | Blog
Under COBRA rules, group health plans may terminate coverage early if a qualified beneficiary becomes entitled to Medicare after electing COBRA. But it’s important to understand what “entitled” really means.
Entitlement vs. Eligibility:
- Eligible means the person qualifies for Medicare (e.g., due to age or disability).
- Entitled means they’ve enrolled in Medicare and are receiving benefits.
Someone who is eligible but hasn’t enrolled yet is not considered entitled—and their COBRA coverage should continue.
When Does Entitlement Begin?
- For Medicare Part A, entitlement is automatic if the person is already receiving Social Security or Railroad Retirement benefits. Otherwise, they must apply.
- Medicare Part B entitlement typically begins when Part A does, or during a later enrollment period.
Important:
Only the individual who becomes entitled to Medicare can have their COBRA coverage terminated early. Other family members on COBRA—like a spouse or dependents—can continue their coverage.
Before ending COBRA early, confirm that the individual is enrolled in Medicare—not just eligible.
Source: Thomson Reuters
by admin | Oct 20, 2025 | Blog
New 2026 limit provides greater savings flexibility for working families
Effective January 2026, the annual contribution limit for Dependent Care FSAs will increase from $5,000 to $7,500 per household. For those married filing separately, the limit rises from $2,500 to $3,750. This is the first permanent increase since the benefit was established in 1986, intended to help working families manage rising childcare costs.
This change was introduced as part of the One Big Beautiful Bill Act, signed into law on July 4, 2025. The bill includes sweeping updates to employee benefits, aiming to provide greater financial flexibility for working families
A Dependent Care Flexible Spending Account (DCA or Dependent Care FSA) is a pre-tax benefit account that allows employees to set aside money to pay for eligible child or adult dependent care expenses. These can include daycare, preschool, before- and after-school programs, and elder care services—provided the care enables the employee (and spouse, if applicable) to work or look for work.
Key Considerations for Employers
- Plan updates required: Employers must revise Section 125 cafeteria plan documents to reflect the new limits.
- Nondiscrimination Testing still applies: Plans must pass IRS rules to ensure fairness across income levels.
- Clear communication is essential: Employees need to understand the new limits, deadlines, and use-it-or-lose-it rules.
- Employers should connect with their HRIS partners/vendors to update system configurations accordingly.
- Employers with non–calendar-year plans may adopt the higher limit effective January 1, 2026, provided their plan documents are amended accordingly. Employers must also ensure no employee exceeds the annual $7,500 contribution limit for the 2026 tax year.
Employers may adopt the increased limit with their next plan renewal. If adopted, be sure to update payroll systems, plan documents, and employee communications before the start of the plan year.
by admin | Oct 14, 2025 | Blog
The IRS announced the 2026 contribution limits for all Flexible Spending Account (FSA) plans. Below is an overview of the limit increases across all the types of FSAs.
Health Flexible Spending Account
The Health FSA, which provides employees the ability to set aside money on a pre-tax basis to pay for eligible medical, dental, and vision expenses will have an increase to its contribution maximum from $3,300 to $3,400 for 2026. The new contribution limit will also apply to the Limited Purpose FSA which reimburses eligible dental and vision expenses. Limited Purpose FSA limits will also increase from $3,300 to $3,400 for 2026.
Carryover Limit
The FSA Carryover limit provides employers the option to transfer a maximum amount of remaining FSA balances at a plan year’s end to carryover for use during the next plan year. This is available with Healthcare and Limited Purpose FSAs only. The carryover limits for this account will increase from $660 to $680 for 2026.
Dependent Care Flexible Spending Account
The Dependent Care FSA allows employees to set aside pre-tax dollars to pay for eligible dependent care expenses,
such as daycare, preschool, and before- or after-school programs. For 2026, the contribution limit will increase from
$5,000 to $7,500 for single taxpayers or married couples filing jointly. For married individuals filing separately, the limit
will increase from $2,500 to $3,750. This change was enacted through legislation passed in July 2025 and is not subject
to annual inflation adjustments.
Commuter Benefits
Commuter Benefits help employees pay for certain parking, mass transit, and/or vanpooling expenses with pre-tax dollars. The contribution limits for this account will increase from $325 to $340 for 2026.
Adoption Assistance
The Adoption Assistance FSA helps employees pay eligible adoption expenses such as agency fees and court costs by contributing to the account with pre-tax money from their paycheck. The contribution limits for this account will increase from $17,280 to $17,670 for 2026.
For more information about this major change, read our latest handout.
