Puerto Rico - INSIDER highlights
Several articles in this edition are related to the recently enacted Economic Growth and Tax Relief Reconciliation Act (EGTRRA) which contained reductions in income tax rates, changes in estate taxes and some pension reform provisions. Most of these changes do not affect employers in Puerto Rico as they are changes in the U.S. Internal Revenue Code. Thus, for example, the changes in limits on contributions to 401(k) plans (shown
here) will not affect Puerto Rico 1165(e) plans, since Puerto Rico plans are regulated by the Puerto Rico Internal Revenue Code.
Nonetheless, some aspects of the legislation are applicable to Puerto Rico. These are summarized on the attached chart. Two additional articles in this edition may be of interest to employers in Puerto Rico.
(1) The article entitled "Benefit Legislation in the New Senate" looks at the prospects for legislation on patients' rights, minimum wage and Medicare reform, all of which could be applicable in Puerto Rico.
Read the full story.
(2) Also, the article entitled, "Court Rules That Not Covering Prescription Contraceptives Violates the PDA" reviews a recent decision by the federal district court in Seattle regarding coverage of prescription contraceptives in group medical plans. While this decision is only applicable in that Western district, this may be an indication of future rulings in other districts.
Read the full story.
This correspondence also contains an overview of this year's recently released Puerto Rico Manufacturers Association Compensation Survey conducted annually by Watson Wyatt. Should you be interested in purchasing the survey report, please return the enclosed order form.
Please feel free to call us with any questions you may have.
Sincerely,
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