Vol. XVI, Issue 39

December 14, 2017

Wespath to Launch New “Social Values Choice” Suite of Funds

Wespath’s new “Social Values Choice” suite of funds, for participants with a heightened focus on companies’ environmental and social performance, will become available on Saturday, December 16. The suite includes two fixed income funds, which will now be made available to participants who self-direct their investments, and an equity fund.

The suite will include:

SVCBF, an actively-managed fixed income fund, and ESVPF, a passively-managed global equity fund, adhere to investment guidelines addressing concerns expressed in resolutions approved by a threshold number of United Methodist annual conferences dealing with:

USTPF seeks to complement the bond and equity funds by helping to mitigate the effects of rising inflation.

SVCBF and USTPF will be accessible on Benefits Access by the end of the day, Saturday, December 16. ESVPF was made available to participants in July.

All three funds are currently available to institutional investors affiliated with The United Methodist Church.

Forms and brochures you may be using for your participants will be updated on December 16 to reflect the availability of the suite of funds. If you have printed copies of the following items, please dispose of them and print or request the new versions:

Communicating to Participants

Wespath will be issuing a press release next week announcing the Social Values Choice suite of funds to the broader Church. We will also be promoting the suite in the January issue of Hark!, distributed with participants’ quarterly statements.

IRS Sending Penalty Letters Re: ACA Employer Mandate

In November 2017, the IRS announced that it plans to send preliminary letters to large employers1 in late 2017, to begin the process of imposing penalties for violations of the employer mandate under the Affordable Care Act (ACA). By early December, some large employers had begun receiving such letters. The letters are designed to begin enforcement of the requirement that applicable large employers either offer health coverage to full-time employees or pay a penalty (the “Employer Shared Responsibility Payment”). This requirement is often referred to as the “Employer Mandate.”

The IRS indicates that it plans to send the preliminary letter if: (1) one or more of the employer’s full-time employees received an ACA premium tax credit for one or more months in 2015, and (2) the employer’s Form 1094-C and Form 1095-C do not show that it offered the employee an affordable plan (or that the employer was eligible for an exemption from the requirement to offer coverage).

An employer receiving one of these letters will have 30 days (from the date of the letter) to respond. The employer can either agree with the penalty and pay it, or can dispute the penalty.

It is possible that the IRS letters will be based on erroneous information, since they are based on tax returns filed by the employees (indicating receipt of premium tax credits), and on the Forms 1094-C and 1095-C filed by the employers (or by third parties hired by employers to file these forms). The IRS description of the information the letter will be based on is available here. A sample of what the letter looks like is available here.

More information about the process is available on the IRS website at this FAQs sheet (see FAQ 55-58).

If the employer files a response indicating disagreement with the IRS’s letter, the IRS will respond. If the IRS does not accept the employer’s position, the employer can request a pre-assessment conference, by filing a formal protest within 30 days with the IRS Office of Appeals.

Instructions for filing an appeal with the IRS or providing corrected information for consideration are provided in the letter.

Questions about these letters should be directed to the IRS.

1 Only “applicable large employers” (ALEs) may be eligible for employer shared responsibility penalties. See this 2015 article for more information.

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