Education including a variety of meetings would be held at the Seattle, Bothell and Tacoma campuses, and at UWMC and Harborview to provide information and answer your questions about what a VEBA would mean to you. These special tax-free accounts can be used by the retiree and eligible dependents to pay medical expenses after retirement, and are operated under rules established in the Internal Revenue Code. Currently, employees receiving their sick leave cash-out payment at retirement must pay federal income and FICA taxes. Additionally, the UW saves its portion of the FICA tax. If a spouse or dependent children survive the retiree, they can continue to access the funds to pay for medical benefits until the account is used up.
Payments made to estates are taxable.
Implementation of the VEBA would be by vote of impacted employee groups. If the VEBA is authorized by the Board, the University would coordinate voting for certain employee groups not represented by labor unions, including Professional Staff, Librarians, and non-represented Classified Staff. Those staff represented by labor unions would be contacted directly by their union representatives regarding the union voting process. Each union would then notify the University of the results for their members. The VEBA would only be implemented if the group vote determines that a majority of those employees wish to participate in such a program.