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HR Support on Adoption Assistance Benefits
Editor's Note: Adoption assistance programs can promote a family-friendly workplace.
Overview: Adoption assistance programs are becoming more prevalent as an employer-sponsored benefit. The number of employers offering such services as part of their employee benefit program continues to grow as adoption becomes more common in the US.
Adoption assistance benefits can be grouped into two general categories:
- Financial assistance benefits are the monetary benefits offered by the employer. Some employers provide a lump sum payment while other employers reimburse specific adoption expenses such as adoption agency fees, court costs and legal fees. Employers can reimburse employees when the adoption is finalized, at the time of placement or as expenses are incurred.
- Informational resources such as referrals to adoption agencies/support groups, access to an adoption specialist and information and guidance provided through an employee assistance program.
Adoption assistance benefits help employers to promote a family-friendly culture and show fairness and equity with other employees who have given birth to a child and have perhaps received paid maternity leave and/or health care coverage.
Tracy Morley, SPHR, Legal Editor
Latest items in Adoption Assistance
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Taxation of Employee Compensation
Employees' salary and fringe benefits are subject to federal income taxes, Social Security and Medicare taxes, and federal unemployment insurance tax. However, certain cash and noncash fringe benefits may be offered to employees on a tax-free basis, while an otherwise tax-free fringe benefit becomes taxable compensation to employees if employers do not meet the rules for that particular fringe benefit .This section assists HR professionals in determining which fringe benefits (e.g., company car, health benefits) and other compensation (e.g., bonuses, awards) are taxable or not.
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Does an income tax exclusion apply to amounts connected with unsuccessful adoption attempts?
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Impact of the American Taxpayer Relief Act of 2012 on Payroll
The American Taxpayer Relief Act of 2012, signed into law on January 2, 2013, made several payroll related changes. To help employers understand the impact of the new law, XpertHR has updated several sections of the Employment Law Manual and all related Worked Examples and How To tools.
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IRS Announces 2013 Inflation Adjustments
XpertHR has updated its payroll content to reflect 2013 inflation adjustments in amounts for excludable transportation fringe benefits, adoption assistance benefits, the standard deduction and personal exemption.
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How much should we exclude from an employee's taxable income for qualified adoption expenses?
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Are the rules for foreign adoptions the same as for domestic adoptions?
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Can we offer an adoption assistance program as part of our cafeteria plan?
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Is employer-provided adoption assistance subject to FIT, FICA, or FUTA withholding?
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What requirements must an adoption assistance program meet for income tax exclusion?
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Other Benefits and Services
Employers should consider providing benefits that offer convenience and cost savings to employees even if they are not legally required to do so, as they can increase retention and improve recruitment. This section provides an overview of popular benefits, including commuter/transportation benefits, dependent care benefits, tuition assistance, employee assistance programs, discounted insurance benefits and severance benefits.
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HR guidance on providing adoption assistance benefits to promote fairness and equity in the workplace.