With all the scuttle butt about layoffs and such, has anyone heard anything about a reduced SERMA or losing the Serma if bought out?
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Who controls the IRS these days ?
Thanks for researching this!
IRS classifies SERMA as a "Health Reimbursement Account" (HRA) and that these accounts fall under ERISA guidelines. Therefore, they should be protected in the case of bankruptcy.
@av+1jjbtgvrw Actually, employee pay and benefits are near the very top of make whole in bankruptcy. However, in the case of SERMA, I believe the funds are held in trust earning US Treasury interest... once you get the funds (leave employment). It earns zero while you are employed... so you get the $1,500 per year of service when SERMA was active.
Finally something relevant on this site. 👏
If it is a buyout SERMA would probably have to be paid out but if it is a bankruptcy then it would probably be pretty low on the priority.
I would try to understand where SERMA priority resides during a liquidation event. It continues to be less a priority over time, I'm sure