More Health Care Premium updates from the IRS

Under the Affordable Care Act, health coverage provided for an employee’s children under the age of 27 is now tax free to the employee effective March 30, 2010. If you have a cafeteria plan or a Section 125 plan, employees can make pre-tax contributions to this plan to pay for this benefit. See more information on this topic at the IRS website.

And the 65% subsidy on COBRA health insurance premiums has been extended past March 31, 2010. This subsidy covers employees who are involuntarily separated from their jobs between September 1, 2008 to May 31, 2010 and lasts for a period of 15 months. Eligible workers pay 35% of their premium to their former employers and the employer applies for a credit of 65% on their payroll tax return. See more information on this topic at the IRS website.