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HARDSHIP, see DISTRIBUTIONS, SECTION 401(k) PLANS (Restrictions on distributions of elective deferrals)
HATFA (HIGHWAY AND TRANSPORTATION FUNDING ACT OF 2014)
* Summary of legislation, (Ch1A/Def-EBSA) Also see MAP-21
HCE, see HIGHLY COMPENSATED EMPLOYEE
HEALTH BENEFITS
* Accident and health insurance benefits
- Tax consequences relating to the payment of premiums for accident or health insurance, (Ch7/SecIII/PtB.1.)
* Disability insurance to continue retirement plan contributions, (Ch6/SecIV/PtC.4.i.)
* Health savings accounts (HSAs), (Ch12/SecXI)
- Comparability rule, (Ch12/SecXI/PtF)
◆ Exception for NHC contributions in post-2006 years, (Ch12/SecXI/PtF.2.b.)
- Contribution limits, (Ch12/SecXI/PtD)
◆ Age 55: additional limits, (Ch12/SecXI/PtD.3.)
- Distributions from HSAs, (Ch12/SecXI/PtG)
- Eligible individuals, (Ch12/SecXI/PtA)
- Establishment of an HSA, (Ch12/SecXI/PtC)
- Expatriation can trigger taxation, see EXPATRIATION
- Health FSA disregarded under certain circumstances in post-2006 years, (Ch12/SecXI/PtA.6.a.1))
- High deductible health plan, (Ch12/SecXI/PtB)
◆ Preventive care, (Ch12/SecXI/PtB.5.)
◆ Special rule for part-year coverage, (Ch12/SecXI/PtD.5.)
- Nondiscrimination test, see Comparability rule above
- Not an employee welfare benefit plan covered by ERISA, (Ch13A/SecII/PtD.5.)
◆ Additional clarifications on ERISA status, (Ch13A/SecII/PtD.5.a.)
- Rollovers into HSAs
◆ Qualified HSA distributions from HRAs or health FSAs, (Ch12/SecXI/PtD.8.a.)
◆ Qualified HSA funding distributions from IRAs, (Ch12/SecXI/PtD.8.b.)
- Table of relevant HSA dollar limits, (Ch17/SecII/PtN)
- Tax treatment of contributions, (Ch12/SecXI/PtE)
- Timing of HSA contributions, (Ch12/SecXI/PtD.6.)
- Withdrawal of Economic Stimulus Act deposits, (Ch12/SecXI/PtI)
* Incidental accident or health insurance provided through plan, (Ch3B/SecVI)
- Long-term disability policy purchased through 401(k) accounts, (Ch3B/SecVI/PtA)
* Long term care insurance premiums paid by plan, (Ch7/SecIII/PtB.1.a.1))
* Medical reimbursement account under a profit sharing plan, (Ch3B/SecVI/PtB)
* Post-retirement medical benefits provided under pension plan (IRC §401(h)), (Ch3B/SecVI/PtC)
- Qualified transfers of surplus funding in defined benefit plan to 401(h) accounts under such plan (IRC §420), (Ch3B/SecVI/PtD)
- Tax issues, (Ch7/SecIII/PtB.1.c.)
* Retired public safety employees may receive tax-free distributions to purchase health care benefits, (Ch7/SecII/PtB.9.)
* Retiree health accounts, see Post-retirement medical benefits above
* Transfer of surplus assets in defined benefit plan to health benefit accounts, (Ch3B/SecVI/PtD)
HEALTH SAVINGS ACCOUNTS (IRC §223), see HEALTH BENEFITS
HEART Act
* Death or disability occurring while in military service (HEART Act rule), (Ch3B/SecVII/PtI.1.)
* Differential wage payments (HEART Act rule), (Ch3B/SecVII/PtI.2.)
* Expatriates - special tax rules with respect to deferred compensation held by persons who relinquish U.S. citizenship, (Ch7/SecII/PtB.3.a.) Also see EXPATRIATION
* Nondiscrimination testing rules: application to contributions/benefits attributable to differential wage payments, (Ch9/SecXI/PtL.1.)
* Severance from employment treatment with respect to a 401(k) plan for individuals on active military duty, (Ch6/SecIV/PtC.13.b.)
* Summary of HEART Act provisions, (Ch15/SecIX/PtM)
HIGHEST 25 HCEs
* Restricted payouts under defined benefit plans, (Ch9/SecXI/PtD.2.a.)
HIGHLY COMPENSATED EMPLOYEE
* 5% owner test, see 5% owner test below
* $80,000 compensation test (post-1996 years), see Compensation test for determining HCEs in post-1996 years below
* Acquisition or disposition of another company and the effect on the HCE determination, (Ch1A/Def-HighlyCompensatedEmployee/PtG.4.)
- Acquiring ownership in another entity, (Ch1A/Def-HighlyCompensatedEmployee/PtG.4.)
- Adding new related group member, (Ch1A/Def-HighlyCompensatedEmployee/PtG.5.)
- Asset acquisition, (Ch1A/Def-HighlyCompensatedEmployee/PtH)
- Disposing of a related group member, (Ch1A/Def-HighlyCompensatedEmployee/PtG.6.)
- Predecessor employer treated as current employer under certain circumstances, (Ch1A/Def-HighlyCompensatedEmployee/PtH)
* Attribution rules: application to determination of highly compensated employees, see ATTRIBUTION RULES
* Calendar year election, (Ch1A/Def-HighlyCompensatedEmployee/PtC.4.)
* Comparison to key employee definition, (Ch1A/Def-KeyEmployee/PtI)
* Compensation definition for applying compensation test for HCE determination, (Ch1A/Def-HighlyCompensatedEmployee/PtB)
* Compensation test for determining HCEs, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.)
- Examples of compensation test, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.)
- Highest paid employee not necessarily an HCE, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.g.)
- Indexed dollar amounts relating to compensation test, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.a.)
◆ Table of HCE compensation dollar amounts, (Ch17/SecII/PtE)
- New employee has no lookback year compensation, so compensation test not satisfied, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.d.)
- Nonqualified deferred compensation is not counted in determining compensation, (Ch1A/Def-HighlyCompensatedEmployee/PtB.4.)
* Coverage testing: identifying HCEs, see COVERAGE TESTING
* Definition of HCE, (Ch1A/Def-HighlyCompensatedEmployee)
* Effective date information, (Ch1A/Def-HighlyCompensatedEmployee/PtA.6.)
* Excluded employees under top paid group, see Top paid group below
* Family relationships: effect of on HCE determination, (Ch1A/Def-HighlyCompensatedEmployee/PtI)
* Five-percent owner test, (Ch1A/Def-HighlyCompensatedEmployee/PtA.6.)
* Former employees: application of HCE definition to, (Ch1A/Def-HighlyCompensatedEmployee/PtJ)
* Indexed dollar amounts for compensation requirements under HCE definition: table, (Ch17/SecII/PtE)
* Leased employees: treatment of under HCE definition, (Ch1A/Def-HighlyCompensatedEmployee/PtE)
* More than one HCE category may apply to an employee, (Ch1A/Def-HighlyCompensatedEmployee/PtA.5.)
* New employer: HCE determination for, (Ch1A/Def-HighlyCompensatedEmployee/PtC.1.c.)
* New plan: HCE determination under (Ch1A/Def-HighlyCompensatedEmployee/PtC.1.a.)
* Nonhighly compensated employee
- Definition of, (Ch1B/Def-NonhighlyCompensatedEmployee)
* Nonresident aliens disregarded in determining HCEs, (Ch1A/Def-HighlyCompensatedEmployee/PtF)
* Ownership defined, (Ch1A/Def-HighlyCompensatedEmployee/PtC.1.a.)
- Attribution rules that apply, see ATTRIBUTION RULES (Section 318 attribution)
* Predecessor employer issues, (Ch1A/Def-HighlyCompensatedEmployee/PtH)
- Acquisition of another company's assets, (Ch1A/Def-HighlyCompensatedEmployee/PtH)
- Acquisition of ownership in another company, (Ch1A/Def-HighlyCompensatedEmployee/PtH.2.)
- Change in the business form, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.)
- Corporation becomes a limited liability company, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.)
- Incorporation of sole proprietorship or partnership, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.)
* Related employers: how relationship affects determination of HCEs, (Ch1A/Def-HighlyCompensatedEmployee/PtG)
- Acquisition or disposition of related group member, (Ch1A/Def-HighlyCompensatedEmployee/PtG.4.)
◆ Adding new related group member, (Ch1A/Def-HighlyCompensatedEmployee/PtG.5.)
◆ Disposing of a related group member, (Ch1A/Def-HighlyCompensatedEmployee/PtG.6.)
- Ownership in related group members not aggregated, (Ch1A/Def-HighlyCompensatedEmployee/PtA.6.)
* Rounding and tie-breaking rules, (Ch1A/Def-HighlyCompensatedEmployee/PtG)
* Short plan year: effect it has on HCE determination, (Ch1A/Def-HighlyCompensatedEmployee/PtC.3.)
* Snapshot testing date, (Ch1A/Def-HighlyCompensatedEmployee/PtC.5.)
* Tax-exempt organization
- Example illustrates that organization might not have any HCEs, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.h.)
* Testing period for determining who is an HCE, (Ch1A/Def-HighlyCompensatedEmployee/PtC)
- Short plan years, (Ch1A/Def-HighlyCompensatedEmployee/PtC.3.)
* Top paid group limitation under compensation test, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.b.)
- Consistency requirement, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.b.4))
- Election does not affect five-percent owner test, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.b.6))
- Example of electing the top paid group limitation, (Ch1A/Def-HighlyCompensatedEmployee/PtA.3.c.2))
- Excluded employees when determining the top paid group, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.c.)
- Manner of making election, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.b.1))
- Timing of election, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.b.1)c))
- Union employees generally taken into account, (Ch1A/Def-HighlyCompensatedEmployee/PtA.2.c.2))