Trump may not have signed it into law yet, but the finaltax bill carries not just drastic changes tothe tax code but also a number of provisions that affect employers—andemployees.

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An HRDive report says that among the changes are the repeal of somebusiness deductions, such as some parking and transportationbenefits and some entertainment expenses; however, they businessesdid gain a tax credit for paying workers while they're out onFamily and Medical Leave Act leave, accordingto an analysis by Willis Towers Watson.

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Employees don’t fare so well, losing not only employer-providedbike commuter benefits and relocation assistance, but also thedeductibility of settlements related to sexual harassment or sexualabuse, which won’t be deductible if they are subject to anondisclosure agreement.

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The report cites an e-mail from D. Finn Pressly, an employeebenefits partner at McDermott Will & Emery, saying, “Dependentcare flexible spending accounts survived the tax reform processunscathed, to the relief of many working parents,”, pointing outthat the House had initially proposed an aggressive plan that wouldhave eliminated these programs.

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The bill also repeals the Affordable Care Act’s individualmandate in 2019, Pressly adds, but that's unlikely to triggersignificant changes to employer-sponsored healthcare plans. Someemployees may economize by dropping coverage, so “[e]mployersshould be sure that their communications emphasize that employeeswho drop coverage will not be allowed back into the plan until thenext open enrollment window unless they experience a qualifyingmid-year election change event (such as a birth or marriage).”

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The final bill also, according to the WTW analysis, “[i]ncludesa modified provision which will prohibit the use ofrecharacterization to unwind Roth IRA conversions,” will repeal thetax exclusion from gross income for qualified moving expenses after2017 and temporarily reduces the threshold for deducting qualifiedmedical expenses to 7.5 percent of income, instead of 10 percent,for 2017 and 2018.

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