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The end of the year is the perfect time to remind employees about annual exams and any other medical benefits that company-sponsored health insurance covers each calendar year.
Most insurers pay for medical benefits, like dental procedures and elective treatments, up to a predetermined annual maximum. In order for employers to reap the most from their coverage, they should be aware of these limits and encourage employees to use their benefits. When employees take full advantage of these benefits, they will be more likely to find them valuable.
With a health care savings account (HSA), employers can set aside a predetermined amount of money that will pay for a range of tax-free employee medical expenses. HSAs can be used when employees or their family members visit a health care provider and pay out-of-pocket medical expenses for things like glasses and prescription drugs.
HSA funds typically expire at the end of the year. So, it’s important to encourage employees to check their balances and use up any remaining funds before the new year.
If you offer vacation benefits to your employees, it’s important that you regularly inform them about how many vacation days they have left — and encourage them to use them! Did you know that 55% of Americans leave vacation days on the table each year? Considering the mental and physical health benefits that time away from work brings, it’s vital that your employees take their time off so they can maximize their productivity while they’re at work.
The timing of bonuses may impact employee compensation. When you give your employees a bonus before the end of the year, you may enable greater employer/employee pension contributions and/or greater employee profit-sharing contributions for the next year.
It’s important to stay on top of tax rules and strategies because if your employees receive their bonuses directly, they’ll need to pay withholding taxes.
Taxpayers can reduce their taxable income through a number of deductions, credits, and expenses. These often apply to activities that are deemed beneficial. Out of pocket medical expenses, donations to charity, and dependent care for singles are among the top missed tax deductions. So a refresher email, webinar, meeting, etc., is a great idea around the end of the year to ensure employees are up-to-speed on pertinent tax deductions and credits.
We hope this HR year-end checklist for employee benefits has been helpful. If you have any questions about benefits or need help handling back office duties and tasks at your small business, America’s Back Office is here for you. Take this quick PEO test to learn more.
If you’re looking for the cream of the crop PEO to partner with, look no further than America’s Back Office. We are part of a small 4% of PEOs that are IRS-certified. This is just one way that we go above and beyond to ensure we are offering the best possible service to our clients. Contact us today for a free consultation.