Vision Payroll

March 31, 2009

IRS Releases Notice on Premium Assistance for COBRA Benefits

The Internal Revenue Service recently released an advance copy of Notice 2009-27, Premium assistance for COBRA benefits. Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a credit on their Form 941 to be reimbursed for the assistance provided.

This notice provides guidance in several areas. In addition to a background of the COBRA premium assistance, Questions and Answers cover the following areas:

Over the next few weeks, Vision Payroll will be providing more detailed information on each of these areas.

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