/// Retirement, Flex & COBRA News

Jayne L. Gaffney
Jayne L. Gaffney
Vice President
(800) 877-5055

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COBRA Penalties for Non-Compliance

The final regulations outline the statutory excise tax penalties imposed on plans for failure to comply with COBRA.


Specifically, plans that violate COBRA’s provisions may be subject to a non-deductible excise tax penalty equal to $100 per day, per an affected individual, per violation. In addition, ERISA provides notice penalties of up to $110 per day from the date of the compliance failure.

The cumulative nature of this penalty can add up to a sizeable sum very quickly, especially in cases where the employer repeats a violation or series of violations with respect to a large number of individuals.


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