The Internal Revenue Service has issued final regulations clarifying the rules regarding the tax treatment of payments by qualified retirement plans for accident or health insurance.
The final regulations in
But the final regulations do not extend this rule to arrangements under which amounts are used to pay premiums for disability insurance that replaces retirement plan contributions in the event of a participant’s disability.
The regulations affect sponsors, administrators, participants, and beneficiaries of qualified retirement plans. They generally apply for taxable years that begin on or after Jan. 1, 2015. However, taxpayers may elect to apply the regulations to earlier taxable years.