Regulatory Roundup May 2023
With the summer months just around the corner, May saw a few legislative updates at the state and federal levels. Maryland signed into law multiple updates to the new Paid Family and Medical Leave (PFML) law the state passed in 2022. The updates address employee contribution levels and program dates. The state of Florida also signed into law a new requirement that eligible employers use the federal E-Verify system to confirm the employment eligibility of new hires, starting July 1, 2023. The new law also establishes certification and document retention requirements for said employers. Finally, the Internal Revenue Service (IRS) released the updated contribution amount limits for Health Savings Accounts (HSAs) and Excepted Benefits Health Reimbursement Arrangements (HRAs). The new amounts for the 2024 calendar year have been adjusted for inflation and apply to both standard plans and High Deductible Health Plans (HDHPs). Learn more about these updates below in this month's Regulatory Roundup.
Maryland PFML Updates
Governor Larry Hogan signed SB-0828 into law on May 3, which updated parts of Maryland's existing PFML law. Specifically, the updates limit the employee contribution rate to 1.2% of the employee's wages and delay the collection of those contributions until October 1, 2024. The updates also delayed the payment of program benefits until January 1, 2026. The state's Department of Labor will determine rates, but equal contributions from employees and employers will fund the program. Eligible employees can take up to 12 weeks of paid leave a year, and the program will replace up to 90% of the employee's weekly wages or up to $1,000 a week. If, however, the leave is due to pregnancy or parental leave after childbirth, eligible employees are entitled to up to 24 weeks of paid leave.
Florida's New E-Verify Requirements
Starting July 1, 2023, all private employers in Florida with at least 25 employees will be required to use the United States Citizen and Immigration Services (USCIS) employment eligibility confirmation service: E-Verify. Under the new law, employers must certify their compliance on annual re-employment tax returns and keep the verification documents for at least three years. However, employers should only use the service to verify the employment eligibility of newly hired candidates within three days of their hiring. It shouldn't be used to verify employment authorization, applicant identity, or eligibility of existing employees unless an employer is a contractor assigned to a federal contract. In those cases, the Federal Acquisition Regulation (FAR) clause requires contractors to use the service for new and existing employees.
Updated HSA and HRA Limits Announced
The IRS released the 2024 inflation-adjusted amounts and limits for HSAs and Excepted Benefits HRAs. Contribution limits for standard HSAs, HDHP HSAs, and HRAs are as follows for the 2024 calendar year:
- Self-Only Coverage: $4,150
- Family Coverage: $8,300
- Catch-Up Coverage (ages 55 or older): $1,000
- HDHP Individual Coverage: $1,600 - $8,050
- HDHP Family Coverage: $3,200 - $16,100
- Excepted Benefit HRA: $2,100
Get more details on the compliance updates from May here:
Bookmark our resource library and come back monthly for Regulatory Roundups of tax and compliance alerts you need to know. For any other frequently asked questions or general assistance, refer to our Administrator Support page for support contact information, quick how-to guides or training courses, important PEAK articles, and more. Remember to follow us on Facebook, LinkedIn, and Twitter for urgent updates.
This information is provided as a courtesy, may change, and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney, or Advisor.