New Type of Employee Benefit Plan Proposed

The “Optimizing Participant Tax Incentives through Optional Noncash Selections (OPTIONS) Act” (H.R. 8314) would allow employers to create a benefit plan that would give employees a choice of benefits. These benefits, all of which would be excluded from an employee’s gross income, would be non-elective employer contributions to retirements plans, contributions to health reimbursement arrangements (HRAs) or health savings accounts (HSAs), amounts paid by employers under an educational assistance program, and other benefits excluded from an employee’s gross income. The plan would not apply to highly-compensated employees. If enacted, it would apply to 2026 and beyond. The motivation for the proposal is to give employees more flexibility in their benefits. Let’s see what happens with this proposal. #IdeaoftheDay

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