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The Wagner Law Group

The Wagner Law Group, A Professional Corporation, is a nationally recognized ERISA & employee benefits, estate planning, employment, labor & human resources practice. 

 

Established in 1996, The Wagner Law Group has 22 attorneys engaged exclusively in employee benefits, estate planning and employment law. Six of our attorneys are AV rated by Martindale-Hubbell as having very high to preeminent legal abilities and ethical standards. The firm is among the largest ERISA boutiques in the country. Our practice is national in scope, with clients in more than 40 states and several foreign countries.

 

 

 

 

Contact Info

The Wagner Law Group

 

  Integrity | Excellence

  

Boston 

Tel: (617) 357-5200 

Fax: (617) 357-5250 

99 Summer Street 

13th Floor

Boston, MA 02110


Palm Beach Gardens 

Tel: (561) 293-3590
Fax: (561) 293-3591
7108 Fairway Drive
Suite 125
Palm Beach Gardens, FL 33418

   

Tampa

Tel: (813) 603-2959

Fax: (813) 603-2961

101 East Kennedy Boulevard

Suite 2140
Tampa, FL  33602 

 

San Francisco

Tel: (415) 625-0002

Fax: (415) 358-8300

315 Montgomery Street

Suite 904

San Francisco, CA 94104

 

St. Louis

Tel: (314) 236-0065

Fax: (314) 236-5743
100 South 4th Street, Suite 550
St. Louis, MO  63102 

 

www.wagnerlawgroup.com

 

 

 

 

January 14, 2016

 

 Health and Welfare Law Alert

 

 

 

 Employer-Provided Identity Protection Benefits Are Tax Exempt

 

 

 

The IRS has issued Announcement 2016-02, allowing preferential tax treatment for employer-provided identity protection benefits, without consideration of whether the employer has actually experienced a data breach. According to the IRS, "identity protection services" include credit reporting and monitoring, identity theft insurance, identity restoration, and other similar services.  

 

Background. Previously, employees who had personal information maintained by their employer could exclude the value of identity protection services provided by their employer only if this information may have been compromised through an actual data breach of the employer's records.

 

Announcement 2016-02. The latest Announcement extends this identity protection services tax exclusion to employees of employers who have not experienced a data breach. In other words, the Announcement allows the value of employer-provided identity protection benefits to be excluded from all employees' income regardless of whether the employer has experienced a data breach. Accordingly, employers need not report the value of identity protection benefits on employees' Forms W-2 or 1099-Misc.

 

While the Announcement does not define "personal information," it offers examples, including a person's name, social security number and bank or credit account number. These examples suggest that the tax relief provided in the Announcement extends all employment arrangements.

 

Takeaway for Employers. Employers should note that the preferential tax treatment provided in the Announcement does not extend to cash provided to employees in lieu of identity protection services or proceeds received by an employee under an identity theft insurance policy.

 

The Announcement is available at: https://www.irs.gov/pub/irs-drop/a-16-02.pdf

 

 

 

 

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This Newsletter is provided for information purposes by The Wagner Law Group to clients and others who may be interested in the subject matter, and may not be relied upon as specific legal advice.  This material is not to be construed as legal advice or legal opinions on specific facts. Under the Rules of the Supreme Judicial Court of Massachusetts, this material may be considered advertising.