[EIDL Update] If your organization received a COVID Economic Injury Disaster Loan, read this important update!
Plus: Our recommendation on EIDL repayment
Our Recommendation for EIDL Repayment:
Pay off this loan as soon as comfortably possible for your organization to avoid a loan maturity balloon payment! At the least pay the accruing interest on a regular basis.
Here's our CEO's Actual Email Response
Hi Client That We Love,
Jina and Randi looped me in on your recent discussion regarding covering medical travel and abortion travel. I understand you all will speak with your health insurance advisors on this, which is a good next step.
I suggest that you speak to your general counsel/corporate attorney as well because, depending on how this unfolds, there could be an additional risk to employers who want to offer this kind of support if the structure of the reimbursement doesn’t line up with the current guidance in the code regarding medical reimbursements.
Here’s a brief overview of some considerations. What we’re probably looking at to keep employer risk as low as possible is the setup of a Health Reimbursement Account (HRA) with clearly outlined policies on what types of expenses will be covered. This would answer potential questions from employees like:
I just wanted to add this additional insight in case it’s helpful.
The lawyers on both sides will have a field day with this…
Suppose Congress supports the Court’s decision to overturn Roe v. Wade and puts pressure on the Treasury. In that case, we may even be looking at a future where employers who choose to cover abortion travel will be subject to an audit of their fringe and health benefits more regularly. (Think: the travel benefit is set up as non-taxable, and because proper plan documents or policies aren’t in place, the IRS claws it all back and makes it taxable to the employer and employee. Then adds penalties, fines, and interest.)
For all these reasons, I strongly suggest legal guidance before proceeding.
Let me know if you want to talk this through more.
NOTE: Blue Fox is an advisory and financial consulting firm, not a law firm or a public accounting firm. Any anecdotal advice shared here should not be relied upon for decision-making. Please consult a CPA, attorney, or other qualified professional before making changes to any benefits policy.
Welcome to the Blue Fox Blog! A fairly entertaining source of info and news related to our company, nonprofits, social sector trends, and, of course, accounting. Enjoy!
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