HISTORY LESSON: Back in days of yore (2/9/72 – 4/4/85) in Ohio, a form of property ownership known as Tenancy By the Entirety (TBE) was recognized. The TBE form of property ownership harkens back to times when women had much less control over their affairs and needed to be protected from their husband’s debts. It is useful now to protect assets from creditors. “TBE” EXPLAINED: The general principle behind TBE property is that it is not owned part by husband and part by wife, but entirely by a fictional third-party made of the union of husband and wife. As such, …
IRS Announces 2014 Pension Plan Limitations
On October 31, 2013, the IRS announced cost-of-living adjustments for 2014 retirement plan contributions. For 2014, the amounts that individuals will be able to contribute to retirement plans will remain the same as 2013. Highlights of the IRS announcement include: Continuing the annual salary deferral limit for 401(k), 403(b), and most 457 plans at $17,500. Leaving unchanged the additional catch-up contribution for employees age 50 and older at $5,500. Increasing the limit on total contributions to defined contribution plans from $51,000 to $52,000. Leaving unchanged the definition of highly compensated employee as an employee making $115,000 per year. Increasing the …
IRS Modifies the Health Flexible Spending Account “Use It or Lose It” Rule to Allow a Limited Carry Over of Unused FSA Funds
On Halloween, the IRS treated employers and health flexible spending account participants to a change in the longstanding “use it or lose it” rule. Beginning immediately, employers may amend their cafeteria plans to allow participants to carry over up to $500 of unused FSA funds at the end of the plan year so that the carryover can be used to reimburse qualified medical expenses incurred in the following plan year. In addition, the amount carried over will not count against the permitted $2,500 salary reduction limit applicable to the next plan year. According to the guidance, however, a plan cannot …