Are You Prepared to Offer a Chevy Instead of a Cadillac?
When the ACA was passed into law in 2010, the Cadillac Tax and 2018 seemed so far away. We advised clients to tackle the ACA a few years at a time and not to get bogged down by provisions that went into effect 8 years out, such as the Cadillac Tax. Now that we are into 2015, 2018 and the Cadillac Tax don’t seem that far away anymore. Last October, we suggested that it was no longer too early to start planning to avoid the Cadillac Tax.
The IRS must agree because yesterday it issued the first piece of “guidance” on the Cadillac Tax. I refer to this Notice as guidance lightly, because instead of providing concrete rules, it outlines potential approaches. My initial read of these potential approaches upsets my stomach even more than I expected, so I really hope that “potential approaches” means improbable approaches. After I have had a chance to digest this guidance (and my Tums kick in), we will report additional details.