Internal Revenue Service July 7, 2014 – Federal Register Recent Federal Regulation Documents

Tax Treatment of Qualified Retirement Plan Payment of Accident or Health Insurance Premiums; Correction
Document Number: 2014-14989
Type: Rule
Date: 2014-07-07
Agency: Internal Revenue Service, Department of Treasury, Department of the Treasury
This document contains corrections to final regulations (TD 9665) that were published in the Federal Register on Monday, May 12, 2014 (79 FR 26838) clarifying the rules regarding the tax treatment of payments by qualified retirement plans for accident or health insurance. The final regulations set forth the general rule under section 402(a) that amounts held in a qualified plan that are used to pay accident or health insurance premiums are taxable distributions unless described in certain statutory exemptions. The final regulations do not extend this result to arrangements under which amounts are used to pay premiums for disability insurance that replaces retirement plan contributions in the event of a participant's disability. These regulations affect sponsors, administrators, participants, and beneficiaries of qualified retirement plans.