CHOICE Act
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed House
- To President
- Became Law
Overview
This bill, the CHOICE Act, modifies the Internal Revenue Code to clarify the tax treatment of ‘custom health option and individual care expense arrangements’ – employer-funded health reimbursement arrangements that cover individuals with individual health insurance. It essentially recognizes these arrangements as meeting certain IRS requirements, potentially simplifying their tax implications for both employers and employees. The bill also includes provisions related to W-2 reporting, cafeteria plan eligibility, and a tax credit for employers offering these arrangements.
Key provisions
- Recognizes ‘custom health option and individual care expense arrangements’ as meeting specific IRS requirements.
- Modifies Section 9815 of the Internal Revenue Code to accommodate these arrangements.
- Includes a provision to report the value of permitted benefits under these arrangements on employees’ W-2 forms.
- Allows employees enrolled in these arrangements to purchase exchange-sponsored health insurance through a cafeteria plan.
- Establishes a tax credit for employers offering these arrangements, incentivizing their adoption.
- Defines the scope of ‘custom health option and individual care expense arrangements’ with specific criteria.
- Clarifies the definition of a ‘specified class of employee’ for non-discrimination purposes.
- Provides for an inflation adjustment to the employer credit amount.
Who is affected
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Sponsors
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