Skip to main content

IRS Issues Notice 2015-52 on Cadillac Tax Implementation

For taxable years beginning in 2018, the Affordable Care Act (ACA) imposes a 40 percent excise tax on high-cost group health coverage. This tax, also known as the “Cadillac tax,” is intended to encourage companies to choose lower-cost health plans for their employees.




On July 30, 2015, the Internal Revenue Service (IRS) issued Notice 2015-52 to continue the process of developing guidance to implement the Cadillac tax. This notice supplements Notice 2015-16, issued on Feb. 23, 2015.



Notice 2015-52 addresses additional issues under the Cadillac tax, including:


  • Identification of the taxpayers who may be liable for the excise tax;

  • Employer aggregation;

  • Allocation of the tax among the applicable taxpayers; and

  • Payment of the applicable tax.




The IRS invites comments on these issues and any other issues under the Cadillac tax. Currently, proposed or final regulations have not been issued on the ACA’s Cadillac tax provision. After considering the comments on both notices, the IRS intends to issue proposed regulations under the Cadillac tax.





Comments should be submitted no later than Oct. 1, 2015. Read the full article for additional details






If you have any questions about this paper, or would like to talk to a trusted advisor, please contact HANYS Benefit Services by calling (800) 388-1963 or email us at hbs@hanys.org.


Popular posts from this blog

What is HR vendor management? Overview with scenarios

Vendor management can be a litigious environment where efficiency, transparency and risk mitigation are paramount. With the right advisor in your organization’s corner, you’ll feel more confident navigating vendors and managing their services, ensuring streamlined processes and strategic alignment.   In this blog post, we'll cover the basics: What vendor management in HR entails, why it's important, how it can transform businesses and some scenarios in a few business types. Level up your knowledge and find the right partners to thrive.  Understanding vendor management in HR  Vendor management in HR involves the systematic management of third-party suppliers who provide goods and services essential to HR operations. This includes managing contracts, ensuring compliance with service level agreements and optimizing vendor performance to align with a company's long-term business goals.  A robust vendor management strategy can provide organizations with a structured ...
Read more

Employee Benefits Offerings: What Perks Can You Add?

Employee benefits can play a crucial role in attracting and retaining top talent. Beyond compensation and bonuses, offering a variety of perks can significantly enhance employee satisfaction and productivity. But what should you include in your employee benefits offerings?   What are employee benefits?   Employee benefits encompass compensation, bonuses and various perks outside an employee's wage. By offering flexible employee benefits, you can improve employee productivity and loyalty while attracting and retaining talented candidates.   Personalized benefits examples   The type of benefits offered can vary by industry. We've compiled some of the most popular options to help you explore possible employee benefits strategies .  1. Social opportunities   Employee perks don't always have to be tied to a benefits package. Sometimes, the best way to engage your employees can be through social opportunities. Group activities can help im...
Read more

Section 125 – Cafeteria Plans Overview

A Section 125 plan, or cafeteria plan , allows employees to pay for certain benefits on a pre-tax basis. Employers use these plans to provide their employees with a choice between cash and certain qualified benefits without adverse tax consequences. Paying for benefits on a pre-tax basis reduces the employee’s taxable income and, therefore, reduces both the employee’s and the employer’s tax liability. To receive these tax advantages, a cafeteria plan must comply with the rules of Section 125 of the Internal Revenue Code and related IRS regulations. Under these rules, a Section 125 plan must have a written plan document and can only offer certain qualified benefits on a tax-favored basis. Once an employee makes a Section 125 plan election, they may not change that election until the next plan year, unless the employee experiences a permitted election change event. Also, for highly compensated employees to receive the tax advantages associated with a Section 125 plan, the plan must pass ...
Read more