Posted in: April 15 2010, Best practices, Fringe benefits, Hiring & training staff, In this week's e-newsletter, IRS regs, Latest news & views, Tax compliance
IRS is moving quickly: Here are the details on how to claim the credit for COBRA premiums you’ll have to pay for recently laid-off workers. The COBRA credit was part of the recent stimulus package, but until now, we had no specifics on how employers could actually claim the credit. Here’s what you need to know now.
To claim the credit, you’ll need the proper documentation:
- Proof you received the employee’s share of the premium (35%)
- A declaration that the former employee was “involuntarily terminated,” and
- For insured plans, a copy of the invoice or similar statement from the insurance carrier, as well as proof the premium was paid on time.
You can claim your credit on Form 941, starting with the first quarter of ’09.
IRS has also released a new FAQ page for employers who need more details on the new procedure. If employees (or former employees) have questions about their rights and responsibilities, you can refer them to this page, which has several links to even more info.