American recovery and reinvestment act of 2009 arra cobra continuation assistance
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AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 (ARRA) COBRA CONTINUATION ASSISTANCE. Presented by: Lori L. Athmann. American Recovery and Reinvestment Act (ARRA). Overview Geared toward layoffs Effective February 17, 2009 Reduction in COBRA premiums Additional Election Opportunities

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American recovery and reinvestment act of 2009 arra cobra continuation assistance

AMERICAN RECOVERY ANDREINVESTMENT ACT OF 2009 (ARRA)COBRA CONTINUATION ASSISTANCE

Presented by: Lori L. Athmann


American recovery and reinvestment act arra
American Recovery and Reinvestment Act (ARRA)

Overview

  • Geared toward layoffs

  • Effective February 17, 2009

  • Reduction in COBRA premiums

  • Additional Election Opportunities

  • Involuntarily terminated employees


Who does arra apply to
Who Does ARRA Apply To?

  • Private sector employers

  • Governmental employees

  • 20 or more employees

  • Minnesota Continuation Coverage


What does arra provide
What Does ARRA Provide?

  • Premium reductions

    • 35% from eligible individual

    • 65% reimbursed to coverage provider through tax credits

  • Additional Election Opportunities

    • Between September 1, 2008, and February 16, 2009

    • Even if employee did not elect COBRA

    • Within 60 days of receiving notice


Who is eligible employee
Who is Eligible Employee?

  • Involuntarily terminated

  • Eligible for COBRA

  • Elects COBRA

  • Adjusted gross annual income

  • Includes dependants

  • Review by Department of Labor


Notice requirements
Notice Requirements:

  • By April 19, 2009

  • General Notice

    • Full

    • Abbreviated

  • Extended COBRA election notice


How do employers receive tax credits
How Do Employers Receive Tax Credits?

  • 65% portion of premium

  • Credit on payroll tax filing

    • Offset payroll tax deposits

    • Overpayment at end of quarter

  • Form 941

  • Cannot claim until employee’s share is paid


Employer reporting requirements
Employer Reporting Requirements

  • Certify employee receiving subsidy

  • Information on the receipt of employee 35% share

  • Copy of invoice from insurance carrier

  • Proof of eligibility and election

  • SSN

  • Amount of subsidy reimbursed as a payroll tax credit



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