If your employee is no longer enrolled in a High-Deductible Health Plan (HDHP), you need to take action to ensure compliance with Health Savings Account (HSA) rules and avoid tax issues. Please note that Lively is not a tax advisor. Before making any changes to employee benefits or contributions, it is recommended that you consult with an accountant or tax advisor to ensure compliance with all applicable tax laws and regulations.
Question(s):
What should I do if my employee is no longer on a High-Deductible Health Plan (HDHP)?
Answer:
If your employee is no longer enrolled in an HDHP, they are no longer eligible for HSA contributions. You should terminate their HSA plan in Lively to avoid tax complications.
Steps
- Confirm that the employee is no longer on an HDHP.
- Log in to your Lively employer account.
- Locate the employee’s HSA and terminate the plan to stop contributions.
- Notify the employee of the change and recommend they consult a tax advisor if needed.
Common Issues/Troubleshooting:
- If you mistakenly continue contributions, reverse them as soon as possible to avoid tax penalties.
- Ensure you promptly update the employee’s status in all relevant systems to avoid future discrepancies.
Please note that Lively is not a tax advisor. Before making any changes to employee benefits or contributions, it is recommended that you consult with an accountant or tax advisor to ensure compliance with all applicable tax laws and regulations.
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