Health and Welfare

The IRS issued Notice 2021-24, which provides guidance following the passage of the American Rescue Plan of 2021 (ARPA). The Notice provides information regarding the applicable penalty relief available to an employer under the ARPA for failing to pay employment taxes in anticipation of a credit for COBRA premium assistance paid to assistance-eligible individuals.

The Department of Labor (DOL) Wage and Hour Division is withdrawing the independent contractor rule that was scheduled to take effect on May 7, 2021. The rule had previously been delayed from its original effective date of March 7, 2021. The withdrawal of the rule is scheduled to be published in the Federal Register May 6, 2021.

In response to the requirements under the American Rescue Plan Act of 2021 (ARPA) to provide model notices and additional guidance in relation to COBRA premium assistance, the Department of Labor has issued model notices and frequently asked questions (FAQs). The FAQs confirm the following.

President Biden has signed legislation that funds another round of assistance as the nation copes with the health and economic effects of the coronavirus pandemic. Several previous bills in 2020 provided direct cash benefits to Americans, created a small business lending program to help employers retain employees, and provided enhanced access to tax-favored retirement savings.

President Biden has signed into law the American Rescue Plan Act one day after the House of Representatives voted to pass the amended package. Several provisions directly affect tax-advantaged savings arrangements.

Following Senate passage on Saturday, the House of Representatives has passed by a vote of 220-211 the American Rescue Plan Act of 2021 to provide additional relief to address the continued impact of COVID-19. Included in the package are several items that would affect retirement and health benefits.

Consistent with a directive by President Biden in a January 20, 2021-issued memorandum entitled, “Regulatory Freeze Pending Review,” the Department of Labor (DOL) Wage and Hour Division has finalized its proposal to delay until May 7, 2021, the effective date of final regulations on independent contractor status. The regulations were published January 7, 2021, in the Federal Register. Their intended purpose as described by the DOL was to clarify distinctions between employee and independent contractor status in employment situations.

The Departments of Labor, Health and Human Services, and Treasury (the Departments) have issued "FAQs About Families First Coronavirus Response Act and Coronavirus Aid, Relief, and Economic Security Act Implementation Part 44" (the FAQs).

The House of Representatives has passed by a vote of 219-212 the American Rescue Plan Act of 2021 to provide additional relief to address the continued impact of COVID-19. Noteworthy retirement and health provisions include the following.

The Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) has released Disaster Relief Notice 2021-01 providing guidance on the duration of COVID-19-related relief previously provided by Disaster Relief Notice 2020-01 and the Notice of Extension of Certain Timeframes for Employee Benefit Plans, Participants, and Beneficiaries Affected by the COVID-19 Outbreak (Joint Notice) issued in 2020 by the DOL, Treasury Department, and the IRS (collectively the "Notices").