Understanding Employee Benefits and key developments in the employee benefits field and items of interest to our clients. MORE

Over a year ago I blogged about the situation of former employees of Verizon who had never worked or resided in the United States but who had U.S. income taxes withheld from payments under benefit plans in which they participated while they worked for Verizon. The former employees had brought a claim for breach of

The IRS recently issued a fact sheet containing tips for employers who outsource payroll duties. In the fact sheet, the IRS reminded employers that they remain responsible for paying withholding taxes even if the employer has paid the payroll provider, but the payroll provider has failed to pay the money to the IRS.

Among the

My colleagues on the employment side of our practice have written an Alert summarizing labor and employment laws enacted in the 2013 Minnesota legislative session. The first new law discussed in the Alert is an amendment to Minnesota statutes expanding the allowable uses of employee sick leave to cover illnesses and injuries of adult children,

A taxpayer we will call John worked for a savings bank in New York that was acquired by Washington Mutual Bank. John participated in the New York bank’s supplemental executive retirement plan (SERP) and its deferred compensation plan, both of which were nonqualified deferred compensation plans. When Washington Mutual Bank acquired the New York bank,

Those of us who work in the benefits area understand that the distinction between employee and independent contractor is an important one, but one in which the determination is not always clear. In many cases, the IRS takes the position that a particular worker is an employee, rather than an independent contractor, thereby requiring the

The Patient Protection and Affordable Care Act requires employers who issue 250 or more W-2s in a year to report the aggregate cost of coverage under an employer-sponsored group health plan in Box 12 of each employee’s Form W-2, using code DD. In general, the amount reported should include both the employer and employee-paid portions

Although our main office is in Minneapolis, Minnesota, we have clients located in other parts of the country, and ourselves have an office in Washington, D.C. Some of our clients have employees who have been hard hit by Hurricane Sandy. Employers want to help their employees, and employees not affected by the hurricane want to

A recent Sixth Circuit Court of Appeals decision concluded that severance pay provided to employees as a result of layoff or discontinuance of a plant, operations or other similar condition is exempt from FICA taxes. According to the court of appeals, it does not matter whether the severance is paid in a lump sum or

Sole proprietors, partners (including LLC members) and two percent shareholders in an S corporation are not treated as “employees” for purposes of certain benefits. Among those benefits is employer provided health insurance coverage. While employer subsidies for health coverage are generally excluded from the income of employees, that is not the case for sole proprietors,

Verizon Communications, Inc. sponsored a number of plans for its foreign employees. These employees were citizens of foreign countries who never worked in the United States. Because these employees never worked or resided in the United States, their employment income and the benefits from their retirement plans were foreign source income not subject to U.