Representative Greg Steube (R-FL) has introduced a bipartisan bill improving flexibility for employer contributions to employee benefit plans.
The Optimizing Participant Tax Incentives through Optional Noncash Selections (OPTIONS) Act builds upon the May 2024 Private Letter Ruling (PLR) 20243400 issued by the Internal Revenue Service (IRS), which allows single employers to implement flexible benefits programs for allocating contributions to employee retirement accounts, Health Savings Accounts, Health Reimbursement Accounts, and educational assistance programs.
However, the ruling is limited to a small number of employers; thus, the OPTIONS Act allows all employers to implement similarly flexible systems.
"American workers deserve more freedom and true financial security when it comes to their benefits," Rep. Steube said in a press release. "Unfortunately, ongoing confusion and inconsistencies with IRS rules governing employer contributions to benefit plans have shortchanged millions of Americans of potential savings."
Representative Suzan Delbene (D-WA), the bill's cosponsor, said, "Workers want more flexibility in their financial planning, but employer contributions are mostly limited to retirement accounts currently."
"With many employees wanting to prioritize student loans and health care bills, this legislation would let them direct their employer contributions to these needs," Rep. Delbene continued, "This commonsense bipartisan bill would give workers more options while ensuring those focused on retirement can continue to save."
In November, Rep. Steube introduced the Helping Everyone Access Long Term Healthcare (HEALTH) Act, which creates a tax deduction for medical professionals who provide healthcare to patients eligible for the Children's Health Insurance Program (CHIP) and Medicaid.
"We are blessed to live in a country with thousands of doctors and physicians who give back to their communities," Rep. Steube commented. "My HEALTH Act will honor their contributions by creating a tax deduction for the charity care they provide to lower-income families and children. Not only will this reaffirm our country's support for those who give back, but it will expand access to quality healthcare for families in need."
