The IRS recently released guidance stating that employers can amend their plans to allow eligible employees to begin contributing to or change their annual election amount for health and dependent care flexible spending accounts (FSAs) without a qualifying life event/change in status. While it is optional for employers to adopt this change, we have decided to do so.
If you are interested in electing to contribute to or making a change to your Health Care FSA (HCFSA) or Dependent Care FSA (DCFSA) election, please keep the following in mind:
- The election must be made prospectively, so you cannot elect a date prior to the date you are entering the change in FermiWorks.
- For HCFSA, you can increase your election up to the maximum limit for 2020 of $2,700. If you are decreasing your annual election, the new amount cannot be lower than the GREATER of your year to date contributions or the amount for which you have already reimbursed in 2020.
- For DCFSA, you can increase up to the maximum annual limit for 2020 of $5,000, but your new annual election cannot be lower than the total amount of your 2020 contributions to date.
- Go to www.payflex.com to view the transactions to your account to ensure your election follows the guidelines above.
- The election change does not have to be made consistent with a qualifying life event/change in status and no documentation is required.
- The change will take effect as soon as administratively feasible, within 1-2 payroll cycles depending on when it is submitted.
- You can make subsequent changes during the year as circumstances change.
Attached are instructions for making a change in FermiWorks.
If you have any questions, please contact firstname.lastname@example.org.