CUNA Regulatory Comment Call

September 13, 2005

Health Savings Accounts (HSAs) – Comparability Rules




Definition of Employer Contribution

Categories of Employees for Comparability Testing

Calculation of Comparable Contributions

Procedures for Making Comparable Contributions

Exception to the Comparability Rules for Cafeteria Plans

Waiver of Excise Tax


Matching Contributions Made Through a Cafeteria Plan

  1. The proposal does not address matching contributions. However, the IRS is requesting comments on whether the ratio of an employer’s matching contributions made through a cafeteria plan to an employee’s salary reduction HSA contributions should be limited. In other words, should there be a calendar year limit or a percentage ratio limit for employer contributions similar to those used in a 401(k)? For example, 50% of the first 3% of salary reduction? Or 100% of the first $200 of salary reduction?

    What should the limit be?

  2. Should employer matching contributions exceeding a specific limit that are made through a cafeteria plan be subject to the comparability rules?

    Yes ______ No ______

    If not, why not?

    Calculation of Comparable Contributions

  3. Are the rules concerning calculation of comparable contributions clear? Are they reasonable?

    Yes ______ No ______

    If not, how could they be made more clear/reasonable?

    Procedures for Making Comparable Contributions

  4. Do you agree with the three methods that employers are to chose from to make contributions when some employees who are eligible individuals do not work for the employer for an entire year: the pay-as-you-go basis, the look-back basis, and the pre-funded basis?

    Yes ______ No ______

    If not, what problems do you foresee/what different approach(es) do you recommend?

  5. Other comments?

    Eric Richard • General Counsel • (202) 508-6742 •
    Mary Mitchell Dunn • SVP & Associate General Counsel • (202) 508-6736 •
    Jeffrey Bloch • Assistant General Counsel • (202) 508-6732 •
    Lilly Thomas • Assistant General Counsel • (202) 508-6733 •
    Catherine Orr • Senior Regulatory Counsel • (202) 508-6743 •