Earlier this year, the IRS finalized proposed regulations under Section 83, which means programs relying on Section 83 should be reviewed and modified as necessary. The new regulations could result in some organizations having non-compliant benefit plans, and non-compliance can result in tax penalties.
Additionally, many not-for-profit organizations use non-qualified deferred compensation programs to enhance executive retirement benefits. Some of these programs utilize the transfer of property provisions under IRS Section 83 to defer taxation. Deferred compensation within life insurance policies is one of the most common programs using this structure.
With the IRS finalizing the proposed regulations under Section 83 in late February 2014, programs relying on Section 83 should be reviewed and modified as necessary.
Section 83 Changes
Section 83 governs taxation when an employer transfers property to an employee. For taxable employers, Section 83 often governs stock-based compensation. For non-profit healthcare employers, Section 83 applies where, for example, the employer pays premiums on a life insurance policy owned by the employee, and the employee forfeits the policy by competing with the employer.
The old noncompete standard was fairly easy to meet; the new standard is not:
- Old Standard—A noncompete will defer taxes if the employer is likely to enforce the forfeiture if the executive competes
- New Standard—A noncompete will defer taxes only if the employee is likely to compete
For more details and to learn whether or not your organization qualifies for deferral under the new standard, visit our Knowledge Center to download the summary document. If you need assistance navigating current and expected law changes for your plans, contact our Total Compensation & Rewards team at 800.327.9335.
In honor of National Healthcare Week, we at INTEGRATED wanted to give back to the dedicated professionals that make our healthcare facilities the places of trusted care that they are. We thank the men and women in our hospitals nation-wide that play an essential role as providers of care.
Our experts are constantly developing new and insightful content for our clients and the healthcare industry. And here, we've pulled together the top eight most-popular items from the past year, ranging from articles to webinars to videos.
We hope these resources provide your organization with intel that help it operate more effectively, and prepare better for the future.
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INTEGRATED Healthcare Strategies just published our latest insights and reviews on some of the healthcare industry's most talked about topics.
Here are summaries of the featured articles. Click here to see the full enewsletter.
Protecting Your Executives and the Hospital from Adverse IRS Audit Findings
Executive compensation is already highly scrutinized - so during an IRS audit, you can expect abnormally large figures will raise questions. There are often good explanations for the high compensation numbers on Form 990 reports, but you'll want to follow these three tips to make sure you protect your executives and organization. Read more>>
Market Trends in Cardiology Compensation
As payments shift from volume to value, the compensation models for cardiology will continue to shift from individual to group incentives. Focus on productivity will continue to be encouraged with consideration for financial performance and patient access, but models will continue to evolve to incorporate shared savings and panel size. In addition, financial affordability and commercial reasonableness concerns will be paramount during the transition period. Read more>>
"Right to Work" in Michigan - Why It Happened
Michigan is the latest state to enact anti-union legislation. Though one of the union stronghold states for over a half-century, the economy in these states has shifted to service-oriented jobs. This has resulted in a growing number of citizens adopting an attitude that unions had their place, but are no longer needed, and can even be a problem. Read more>>
Physician Leadership Training - What Are the Essential Elements?
Effective physician leadership development programs should teach both "hard" content (operational, legal, policies) and "soft" skills (people management). In addition, they need to focus on core competencies for successful leadership programs, and incorporate flexible teaching formats that blend multiple techniques to produce the best results. Read more>>
Effective Leaders in US Healthcare Set Cultures of Celebration
As demands for enhanced patient care experiences increase, a premium is being placed on leaders who can create and nurture high-performance organizational cultures. Follow three steps to begin developing cultures of celebration that yield personal and organizational successes. Read more>>
Extended Deadline: Salary Increase & Benefit Trends Survey
The latest in our quarterly INTEGRATED Salary Increase and Benefit Trends Survey opened last month. The deadline to participate is January 18th, so don't miss your chance to submit your survey and get a complimentary copy of the results report! Read more and participate>>
We're pleased to release the latest issue of our monthly newsletter! Check it out to see insights from the thought-leaders at INTEGRATED; This issue covers topics on Physician Recruiting; Managing Reform; Rising CEO Pay; Physician Pay; Employee Engagement; Salary Trends and more http://conta.cc/SEM1LH
We hope you enjoy the reading!
INTEGRATED Healthcare Strategies just released it's October 2012 eNewsletter. It's packed with great articles from our consultant experts on issues you're hearing about today in the healthcare industry!