The One Big Beautiful Bill Act’s Impact on Employee Benefits

Topic

Description

Effective Date

Telehealth Coverage

Permanently allows high-deductible health plans to cover telehealth services before patients meet their deductibles.

Plan years beginning after 12/31/24

Bronze and catastrophic plan allowance in connection with HSAs

Bronze and catastrophic plans purchased through an exchange are now treated as high-deductible health plans, and individuals enrolled in these plans are eligible to contribute to a health savings account (HSA).

All months beginning after 12/31/25

Direct Primary Care Service Arrangements

Certain “direct primary care” arrangements are no longer considered disqualifying coverage as long as they are paired with a high-deductible health plan. This change allows contributions to an HSA if the individual is simultaneously covered by a high-deductible health plan and a direct primary care arrangement.

All months beginning after 12/31/25

Dependent Care Assistance Plan Limit Increase

Increased the benefit limit to $7,500 when filing as single or married filing jointly ($3,750 married filing separately).

Plan years beginning after 12/31/25

Exclusion for Employer Payments of Student Loans

Permanently allows employers to make student loan reimbursement payments.

All payments made after 12/31/25

Termination of Qualified Bicycle Commuting Reimbursement

Removes the exclusion for the qualified bicycle commuting reimbursement.

Tax years beginning after 12/31/25

Moving Expense Limitation Extension

Removes the exclusion for employer-provided qualified moving expense reimbursements (with few exceptions related to the military and intelligence communities) and the deduction for moving expenses.

Tax years beginning after 12/31/25

Deduction Limitation for Excessive Employee Remuneration

Code Section 162(m) limits the deduction for certain employees for remuneration above $1 million. Aggregation rules will now apply for purposes of the deduction limitation and the allocation of the deduction.

Tax years beginning after 12/31/25

Expansion of Excise Tax Application on Excess Compensation within Tax-Exempt Organizations

Code Section 4960 excise tax rules covering certain tax-exempt organizations that pay over $1 million in remuneration now apply with respect to any employee or former employee of the tax-exempt organization, not just certain covered employees.

Tax years beginning after 12/31/25