All posts by Timothy B. Collins

IRS Publishes Additional Guidance for Employees Impacted by Hurricane Sandy

As a follow-up to our prior entry regarding Employee-Assistance Programs Available to Employers in the Wake of Hurricane Sandy, there have been two recent developments from the Internal Revenue Service of note:

(1) Notice 2012-69 addressed the treatment of certain amounts paid to Section 170(c) organizations under employer leave-based donation programs to aid victims of Hurricane Sandy. The IRS has stated that it will not assert that cash payments an employer makes to Section 170(c) organizations in exchange for vacation, sick, or personal leave that its employees elect to forgo constitute gross income or wages of the employees if the payments are made to the Section 170(c) organizations for the relief of victims of Hurricane Sandy and are paid before January 1, 2014. Similarly, the Service will not assert that the opportunity to make such an election results in constructive receipt of gross income or wages for employees. Employers who have adopted leave-sharing plans (or are considering their adoption) should take note of this development.

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Employee-Assistance Programs Available to Employers in the Wake of Hurricane Sandy

In coping with the aftermath of Hurricane Sandy, which affected millions of individuals across the eastern United States, there are a number of potential programs that employers can implement in order to assist employees. We examine two such programs – the establishment of a major disaster leave sharing plan and tax-free qualified disaster relief payments – in our Client Alert, entitled Employee-Assistance Programs Available to Employers in the Wake of Hurricane Sandy.

IRS Announces Pension Plan Limitations for 2012

On October 20, 2011, the Internal Revenue Service published news release IR-2011-103, which details the cost-of-living adjustments for dollar limitations for pension plans and other retirement-related benefits for the 2012 tax year.

Of particular note for plan sponsors is the fact that the elective deferral limit has been increased from $16,500 to $17,000 and the annual limitation for contributions to defined contribution plans increased from $49,000 to $50,000. In addition, the annual compensation limit increased from $245,000 to $250,000. This is the first increase in those areas since the current limits went into effect for 2009.

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