COBRA Extension | Tax Tip of the Week | No. 41

Employees who involuntarily lost their jobs had been eligible to continue their employer sponsored health insurance coverage through a subsidized assistance program.  This means a displaced employee would only need to pay 35% of their COBRA health benefits, and the employer could take a 65% tax credit on their payroll tax returns.  An employee can continue these benefits for up to 15 months.This plan was set to expire on March 31, 2010.  A new law was recently passed that extends this subsidy program to those eligible employees through May 31, 2010.This is the second extension of the COBRA subsidy program and many Capitol Hill watchers expect the program will ultimately be extended through the end of 2010.We’ll keep you posted.Questions? Just give us a call. In Dayton, call 937-436-3133 and in Xenia, call 937-372-3504. Or visit http://www.bradstreetcpas.com. Rick Prewitt - the guy behind TTW...until next week.