Procedures for payment upon termination
Sec. 23. (a) This section applies when the employment of an
individual by an employer that participates in a medical care savings
account program is terminated.
(b) If the former employer is not informed, within ninety (90)
days after the former employee's final day of employment, of the
name and address of an account administrator to which the former
employer is transferring the former employee's medical care savings
account under section 21 of this chapter, the former employer shall
pay the money in the former employee's medical care savings
account to the former employee under subsection (d).
(c) If:
(1) the former employee, under section 22(2) of this chapter,
requests in writing that the former employer's account
administrator remain the administrator of the individual's
medical care savings account; and
(2) the account administrator does not agree to retain the
account;
the former employer shall, within ninety (90) days after the former
employee's final day of employment, pay the money in the former
employee's medical care savings account to the former employee
under subsection (d).
(d) An employer that is required under this section to pay the
money in a former employee's medical care savings account to the
former employee shall mail to the former employee, at the former
employee's last known address, a check for the balance in the account
on the ninety-first day after the employee's final day of employment.
(e) Except as provided in section 11(b) of this chapter, money that
is paid to a former employee under subsection (d):
(1) is subject to taxation under IC 6-3-1 through IC 6-3-7 as
income of the individual; but
(2) is not subject to the penalty referred to in section 17(c)(2) of
this chapter.
As added by P.L.92-1995, SEC.2 and P.L.93-1995, SEC.2.
Last modified: May 28, 2006