The IRS recently released the 2018 version of Publication 15-B—Employer’s Tax Guide to Fringe Benefits, which contains information for employers on the tax treatment of fringe benefits. The 2018 version is significant because it incorporates the changes made by the new tax law—the Tax Cuts and Jobs Act—to the following fringe benefits:
- Qualified transportation plans
- Moving expense reimbursements
- Employer-provided meals
- Employee achievement awards
Employers that offer fringe benefits should review the 2018 version of Publication 15-B and work with their tax advisors to implement the tax changes.
Earlier this year, a tax law change for 2018 reduced the health savings account (HSA) contribution limit for individuals with family high deductible health plan (HDHP) coverage from $6,900 to $6,850. On April 26, 2018, the IRS announced that, for 2018, taxpayers with family HDHP coverage may treat $6,900 as the annual contribution limit to their HSAs.
Why was the limit changed again?
After the IRS reduced the HSA limit for individuals with family HDHP coverage, it received feedback from various stakeholders, including employers, that the change would be disruptive and costly to implement. For example, some individuals with family HDHP coverage made the full $6,900 HSA contribution before the limit was reduced, and many other individuals made annual salary reduction elections for HSA contributions through their employers’ cafeteria plans based on the $6,900 limit.
In response to these concerns and others, the IRS issued Revenue Procedure 2018-27, which allows taxpayers with family HDHP coverage to use the original $6,900 HSA contribution limit for 2018.