Section 105(h) Non-discrimination Testing and Analysis

Section 105(h) Non-discrimination Testing and Analysis

$415.00 price + options
 
 
In order to qualify for tax-favored status, an Internal Revenue Code (IRC) Section 105(h) plan must be non-discriminatory.

ComplianceBug's non-discrimination testing and analysis services allows you to upload your plan data to test for compliance with IRC Section 105(h).

Section 105(h) plans include:
  • health reimbursement arrangements (HRAs)
  • self-funded health plans (e.g., medical, dental, etc.)

Plans must not discriminate in favor of highly compensated employees and key employees with respect to eligibility, contributions, and benefits. In order to meet these compliance requirements, an annual test must be performed and the results documented for each Section 105(h) plan. The results are subject to audit by the IRS.

There are two distinct aspects of ComplianceBug's non-discrimination testing:

  • Eligibility test - This test looks at who is asked to participate in the plan. In order to pass this test, the company must pass ONE of the following requirements:
    • 70% of all employees participate
    • 70% of all employees must be eligible to participate and of those 80% participate
    • There is no “discriminating” classification of employees
  • Contributions and benefits test - This test requires that all employees should receive the same amount of employer contributions and the same benefits must be available to all employees.

Fees include a $415.00 per test setup fee plus a per participant fee.

To calculate your testing and analysis fees, select the type of plan to be tested and then the total number of employees to be tested. Testing is being performed for the current plan year. Employee data is required if an employee is considered “non-excludable”.

DISCOUNTS AVAILABLE - ASK YOUR BROKER/CONSULTANT IF THEY ARE A COMPLIANCEBUG PARTNER.