Compliance Stuff

Consolidated Omnibus Budget Reconciliation Act (COBRA) compliance often gets treated as a “set it and forget it” administrative task, particularly when employers outsource to third-party administrators. But the legal obligation to provide compliant COBRA notices ultimately rests with the plan administrator, not the COBRA vendor . That makes periodic reviews of COBRA notices essential . A deficient notice is not just a technical error; it can expose the plan (and employer) to statutory penalties, litigation costs, and participant claims. In practice, we routinely see COBRA notices that do not fully comply with COBRA, even when prepared by experienced vendors. Common issues include vague or incomplete election instructions, no reference to the name of the plan, missing deadlines, or unclear premium information . These deficiencies are often discovered only after a participant challenges the notice, at which point it is too late to correct the problem without consequences. Recent experi...

The IRS recently released updated FAQs addressing educational assistance programs under Internal Revenue Code Section 127. While much of the guidance reflects existing rules, the updates incorporate recent legislative changes and provide helpful clarifications for employers that offer or are considering offering education benefits. Refresher: Section 127 Basics Still Apply Section 127 allows employers to provide employees with tax‑free educational assistance of up to $5,250 per year, indexed for inflation after 2026. That amount continues to apply to both traditional tuition assistance and qualified student loan repayment benefits. To qualify, the program must: Be a written plan for the exclusive benefit of employees (click here for our prior post on the document requirement); Avoid discrimination in favor of highly compensated employees; and Be communicated to eligible employees. Student Loan Repayment: Continued Flexibility — With Guardrails The FAQs reiterate that educational ass...