Small Group Disbanding, Employer Contrib Questions

yorkriver1

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1,734
Virginia
As I understand the rules, employers may only give an employee a non-directed raise to compensate for no longer offering a group plan with employer contributions.

Before I discuss the options with the employer, I would like to confirm this method is the only one. They seem to be currently paying 50 or 60% of the individual cost, based on the billing, which is age rated. They are not creating their own composite rate for employer/employee contribution.

I was asked to come and talk to employees about individual plans, after they made the disbanding decision.

There is time, the plan is calendar year renewal.

When discussing this option, anyone who is an employee always asks about the raise being taxed, and my response is that the pay can be grossed up to cover that. Tax prep professional would be involved, I assume.
 
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