How to Incorporate Estate Planning into Your Employee Benefits Package

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Small businesses, typically employing fewer than 50 individuals, aren’t legally obligated to offer employee health insurance. However, providing health coverage is a highly sought-after job benefit. In fact, about two-thirds of business owners use health insurance as an attractive tool to recruit and retain top talent.

Whether health insurance for employees is mandated by law or chosen as an optional incentive, businesses aiming to provide this benefit should consider various plan options, including those that can tie into your broader estate planning strategy.

Understanding Health Insurance Legal Requirements

Here’s a key piece of information regarding the Patient Protection and Affordable Care Act (ACA), often referred to as Obamacare:

Health Insurance for a Healthier, More Productive Workforce

Businesses with fewer than 50 employees are not subject to the ACA’s employer mandate. Nevertheless, they may opt to provide health insurance as a discretionary benefit.

An employer-sponsored health plan offers several advantages:

Regarding tax credits, businesses with fewer than 25 full-time workers that pay at least half of their employees’ health insurance premiums and meet other criteria may qualify for a tax credit covering up to 50 percent of the premiums they pay.

Exploring Group Health Insurance Options

Small business owners interested in obtaining group health insurance typically have two primary avenues: working directly with private insurers or exploring plans through the ACA’s SHOP Marketplace.

With group health plans, the costs are typically shared between employers and employees, with employers determining the extent of their contribution. Typically, employees can choose from different plans with varying costs.

For employers seeking the advantages of offering health benefits but are wary of the expenses associated with sponsoring a plan, they might consider a Health Reimbursement Arrangement (HRA), like the qualified small employer HRA (QSEHRA) or Individual Coverage Health Reimbursement Arrangement (ICHRA).

Make Group Benefits a Group Effort

Navigating health insurance laws can be as intricate as understanding the tax code. It’s crucial to grasp the legal responsibilities of employers and how you can align group health plans with your broader estate planning strategy. Our business attorneys are here to assist you in ensuring your business complies with relevant health insurance laws. Don’t hesitate to contact us to schedule a consultation.