<html><head></head><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; color: rgb(0, 0, 0);"><div><div dir="ltr" style="color: rgb(0, 0, 0);"><font>Hello! </font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri; color: rgb(0, 0, 0);"><font size="2" face="tahoma"><br></font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri, sans-serif;"><font face="tahoma" size="2">I</font><font> had many responses requesting I forward the info I received, so I have included it below. I also have included one attachment. </font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri, sans-serif;"><font><br></font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri, sans-serif;"><font>Thank you for all of the responses. I am feeling slightly better about what needs to happen.</font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri, sans-serif;">Have a great day!</div><div dir="ltr" style="font-size: 14px; font-family: Calibri, sans-serif;"><br></div><div dir="ltr" style="font-size: 14px; font-family: Calibri, sans-serif;"><div><div><div>-- </div><div>Abby Sharp</div><div>CFO/Treasurer</div></div><div>Ayersville Local Schools</div><div>28046 Watson Road</div><div>Defiance, OH 43512</div><div>419.395.1111 ext. 403</div><div><br></div><div>***Please note new email address: asharp@ayersvillepilots.org</div></div><div><br></div><div><br></div></div><div dir="ltr" style="font-size: 14px; font-family: Calibri; color: rgb(0, 0, 0);"><font size="2" face="tahoma"><br></font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri; color: rgb(0, 0, 0);"><font size="2" face="tahoma">Here is as far as we have gotten...I haven't had a chance to dig into the plan docs yet. the memo in the paragraph below was from the OASBO magazine article:</font></div><div dir="ltr" style="font-size: 14px; font-family: Calibri; color: rgb(0, 0, 0);"><font size="2" face="tahoma"></font><font color="#0c0cbc" face="Palatino Linotype">the Guidance and the memo you sent and have the following for you. At this point nothing happens until final regulations are issued, which is likely not before 1/1/17. There is a provision to not apply this requirement to plans in effect prior to 12/16/2015, which is you. Of course we can’t tell exactly what that will mean until the final regulations come out. You will notice toward the bottom of the second page (in bold) it refers to “unconditional opt-out arrangements.” Within that definition an example is provided noting that if there is another requirement, like providing proof of coverage under a spouse’s plan, that it won’t apply. Do you have such a requirement? It’s not in the NFA agreement, but I didn’t know if you require that. If you don’t currently require that, it would be good to get that requirement added, because, based on what we now know it would appear that the requirements would not apply to a plan that required proof of other coverage. Your current contract language (NFA) provides that the opt-out is only available to full-time members “who are insured under a health insurance plan other than that provided in this agreement.” That should be enough to remove it from the unconditional opt-out provision. Do you require that the employee provide you with proof of that other coverage? If not, add that. Also, the determination of whether your insurance is “affordable” or not is based on the cost of a single plan (bottom of page 2 to top of page 3). If your opt-out payment is offered only to those with family coverage, we believe that the amount won’t be imputed because it is not available for single only coverage. The NFA agreement just refers to an “eligible plan participant” so I don’t know if you are limiting it to family coverage only. If not, if you can change it to that, that should also help you avoid this provision. </font><span style="color: rgb(12, 12, 188); font-family: 'Palatino Linotype', serif; font-size: 12pt;">Also, all of these things need to be written in your plan document. Do you know if they are? If you’re not sure we can review your plan if you’d like.</span></div><div dir="ltr" style="font-size: 14px; font-family: Calibri; color: rgb(0, 0, 0);"><p class="MsoNormal" style="margin-bottom: 0px; margin-top: 0px;"><span style="font-size: 12pt; font-family: 'Palatino Linotype', serif; color: rgb(12, 12, 188);"><br></span></p><p class="MsoNormal" style="margin-bottom: 0px; margin-top: 0px;"><span style="color: rgb(31, 73, 125); font-family: Calibri, sans-serif; font-size: 15px;">We provide a monetary stipend to employees who elect not to take our health insurance and our attorney and our section 125 (American fidelity) both agreed that if it is listed as an option in your section 125 document, that, while the benefit is taxable to those that take it, it does not make the insurance taxable to those that take that.</span></p><p class="MsoNormal" style="margin-bottom: 0px; margin-top: 0px;"><span style="color: rgb(31, 73, 125); font-family: Calibri, sans-serif; font-size: 15px;"><br></span></p><p class="MsoNormal" style="margin-bottom: 0px; margin-top: 0px;"><span style="color: rgb(31, 73, 125); font-family: Calibri, sans-serif; font-size: 15px;">We stayed in compliance by moving the payment inside our Section 125 offering.</span></p><p class="MsoNormal" style="margin-bottom: 0px; margin-top: 0px;"><span style="color: rgb(31, 73, 125); font-family: Calibri, sans-serif; font-size: 15px;"><br></span></p><p class="MsoNormal" style="margin: 0in 0in 0.0001pt; font-size: 12pt; font-family: 'Times New Roman', serif;"><span style="font-size: 11pt; font-family: Calibri, sans-serif; color: rgb(31, 73, 125);">In addition to the tax implications – adverse selection of just keeping those on the plan who have claims and cutting the premiums paid in a small group can backfire on raising costs to the district and remaining employees as well.</span></p><p class="MsoNormal" style="margin: 0in 0in 0.0001pt; font-size: 12pt; font-family: 'Times New Roman', serif;"><span style="font-size: 11pt; font-family: Calibri, sans-serif; color: rgb(31, 73, 125);"> </span></p><p class="MsoNormal" style="margin: 0in 0in 0.0001pt; font-size: 12pt; font-family: 'Times New Roman', serif;"><span style="font-family: Calibri; font-size: medium;">See page 4, it may help - </span><a href="http://www.ia-sb.org/Main/Downloads/news/IRS_Guidance_Cash_Options_2.16.16.pdf" style="font-family: Calibri;">http://www.ia-sb.org/Main/Downloads/news/IRS_Guidance_Cash_Options_2.16.16.pdf</a></p><p class="MsoNormal" style="margin: 0in 0in 0.0001pt; font-size: 12pt; font-family: 'Times New Roman', serif;"><br></p></div></div><div style="font-size: 14px; font-family: Calibri, sans-serif; color: rgb(0, 0, 0);"><br></div><div style="font-size: 14px; font-family: Calibri, sans-serif; color: rgb(0, 0, 0);"><br></div><div style="font-size: 14px; font-family: Calibri, sans-serif; color: rgb(0, 0, 0);"><br></div><span id="OLK_SRC_BODY_SECTION" style="font-size: 14px; font-family: Calibri, sans-serif; color: rgb(0, 0, 0);"><div style="font-family:Calibri; font-size:11pt; text-align:left; color:black; BORDER-BOTTOM: medium none; BORDER-LEFT: medium none; PADDING-BOTTOM: 0in; PADDING-LEFT: 0in; PADDING-RIGHT: 0in; BORDER-TOP: #b5c4df 1pt solid; BORDER-RIGHT: medium none; PADDING-TOP: 3pt"><span style="font-weight:bold">From: </span> Abby Sharp <<a href="mailto:asharp@ayersvilleschools.org">asharp@ayersvilleschools.org</a>><br><span style="font-weight:bold">Date: </span> Tuesday, July 19, 2016 at 2:59 PM<br><span style="font-weight:bold">To: </span> oecn_treas <<a href="mailto:oecn_treas@oecn.k12.oh.us">oecn_treas@oecn.k12.oh.us</a>><br><span style="font-weight:bold">Subject: </span> Providing Incentives for Employees Waiving Health Insurance Coverage<br></div><div><br></div><div><meta http-equiv="Content-Type" content="text/html; charset=Windows-1252"><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; color: rgb(0, 0, 0); font-size: 14px; font-family: Calibri, sans-serif;"><div>Hello!</div><div><br></div><div>I hope you are enjoying some peace and quiet this summer!</div><div><br></div><div>Has anyone figured out how to provide an incentive to employees for waiving health insurance coverage without causing an unfunded tax liability to those employees who take insurance? The OEA seems to think there is a way around this but our attorneys
don’t quite agree. If you have an answer to this, I’d love to hear it!</div><div><br></div><div>Thanks!</div><div>Have a great day!</div><div><div><div>-- </div><div>Abby Sharp</div><div>CFO/Treasurer</div></div><div>Ayersville Local Schools</div><div>28046 Watson Road</div><div>Defiance, OH 43512</div><div>419.395.1111 ext. 403</div><div><br></div><div><br></div></div></div></div></span></body></html>