Some employers offer health and other welfare benefits to non-dependent domestic partners of employees. Providing domestic partner benefits can give rise to unique compliance issues from a state and federal tax standpoint. As a result of the federal Defense of Marriage Act, the value of benefits extended to non-dependent same-sex domestic partners must be taxable to the employee.
Many employers that offer same-sex domestic partner benefits require those benefits to be paid on an after-tax basis rather than on a pre-tax basis through the cafeteria plan. Moreover, many employers impute income to the employee covering the domestic partner.
BAS can make managing domestic partner benefits much easier by 1) identifying domestic partner dependents in MyEnroll for easy reporting, 2) identifying domestic partner dependents on carrier eligibility files, if required under the group policy, 3) modifying the benefits payroll file feed so that your payroll provider can make employee deductions on both a pre- and post-tax basis, or 4) directly billing employees for the post-tax premium contributions if the payroll provider is unable to accommodate the post-tax deduction and 5) calculating the imputed income tax attributable the domestic partner benefits.
If you would like to find out more information about adding domestic partnership reporting services to your existing services, please contact your BAS Account Manager or Sales@BASusa.com.