04-26-2006 Council Agenda - Laserfiche WebLink

Home Browse Search

VantageCare Retirement Health Savings Program Ex.e/curvy@ S ay Participation and Contributions in the VantageCare Retirement Health Savings Plan Contribution and participation features of the VantageCare Retirement Health Savings (RHS) Plan are permit- ted by ICMA Retirement Corporation (ICMA -RC), pursuant to a formal private letter ruling issued by the Internal Revenue Service ( "IRS ") and subsequent opinion of ICMA -RC's outside counsel, Groom Law Group, a leading legal firm in the area of employee benefits. Employers should evaluate the RHS provisions that meet the plan needs of both the employer and employee, keeping the level of authority governing the provi- sion in mind. While some employers may not choose to adopt provisions not previously ruled on by the IRS, other employers will be comfortable with an opinion of ICMA -RC's outside counsel, particularly after the opinion is reviewed by the employer's benefits counsel. Ixisting Provisions The following features are specifically addressed in the Private Letter Ruling issued by the IRS in connection with the first municipality adopting the VantageCare RHS program: Participation Mandatory participation - employees in the covered group(s) are required to participate. There is no option at the employee level. Contributions Direct employer contribution - These are contributions made directly by the employer in either flat dollar amounts or as a percentage of compensation. Mandatory vacation and sick leave contribution - Mandatory contribution of accrued vacation or sick leave according to a pre- determined schedule established by the employer or collective bargaining unit. Mandatory pre -tax employee contribution - Mandatory reduction from salary according to a pre- determined schedule established by the employer or collective bargaining unit. (over) ICMA RETIREMENT CORPORATION The Public Sector Expert