On April 21, 2021, the IRS and the US Treasury Department published a fact sheet on the tax credits available under American Rescue Plan Act (ARPA) to employers who provide paid leave to employees who get COVID-19 vaccinations. ARPA extends tax credits previously established under the Families First Coronavirus Response Act (FFCRA) to reimburse employers for the cost of voluntarily providing paid sick and family leave to employees due to COVID-19. For a complete discussion of the ARPA and FFCRA leaves, please see Lake Effect's prior blog. The new fact sheet confirms the following:
Employers should work closely with their tax advisors to understand the tax implications of COVID-related paid sick and family leaves, including those covering vaccinations. We are closely monitoring developments relating to COVID-19 and the workplace. Keep watching for blogs and emails from your Lake Effect team for important legal updates and HR best practices. The attorneys and HR professionals at Lake Effect HR & Law are ready and willing to help. Contact us at email@example.com or 1-844-333-5253.
On April 7, 2021, the US Department of Labor published FAQs and model notices implementing the temporary COBRA premium assistance provisions of the American Rescue Plan Act of 2021 (ARPA). Employers and other group health plan issuers are subject to new COBRA notice and other requirements.
What: Under the ARPA, “Assistance Eligible Individuals” may elect to continue employment-based group health plan coverage for up to 5 months – from April 1, 2021 through September 30, 2021 – without paying COBRA premiums. Employers or plan issuers must pay premiums on behalf of such individuals and will be reimbursed through a COBRA premium assistance tax credit.
Who: To be an “Assistance Eligible Individual” under the ARPA, an individual must meet all of the following requirements:
When: COBRA premium assistance is available for periods of coverage from April 1, 2021 through September 30, 2021. Assistance will end earlier if an individual:
Notice Requirements: Employers and other plan issuers must notify qualified beneficiaries about COBRA premium assistance and other rights as follows:
Additional Election Opportunities: The ARPA provides additional COBRA election opportunities under certain circumstances:
This summary of ARPA’s COBRA premium assistance provisions is not intended to provide an exhaustive analysis of the law, but your partners at Lake Effect are ready to help you navigate the new requirements. Employers should also work closely with their group health plan providers to ensure complete compliance with COBRA notice and coverage provisions.
We continue to monitor developments and guidance relating to the American Rescue Plan Act of 2021 and other legislative efforts to address the continuing impact of the COVID-19 pandemic. We will provide you with employment-related updates on these topics as they arise.