Cafeteria Plan and FSA Relief

Due to the Coronavirus outbreak, the IRS recently released Notice 2020-29, which allows employers to elect to allow employees to make mid-year election changes to their medical benefits, as well as to their Medical and Dependent Care Flexible Savings Accounts (FSA). Normally, employees would not be eligible to make these changes outside of the open enrollment period for calendar year 2020.

As a result of Notice 2020-29, Los Rios has taken action to amend our Plan Document to allow employees to make these changes consistent with Notice 2020-29, effective immediately. These changes include:

1. Employees enrolled in a health plan will be permitted to make a maximum of two prospective mid-year election changes due to COVID within the 2020 calendar year. Examples include:
   • Changing from waiving to electing a medical plan
   • Changing from electing to waiving a plan
   • Adding and/or removing eligible dependents from plans
2. Employees enrolled in the Medical and/or Dependent Care FSAs will be permitted to make a maximum of two prospective mid-year election changes due to COVID during the 2020 calendar year for each account. Examples include:
   • Amending Dependent Care payroll deduction amounts to decrease/increase future deductions due to a change in child care expenses
   • Amending Medical FSA payroll deduction amounts to reflect a increase/decrease in anticipated medical costs
3. Under this special provision, employees enrolled in the 2019 Medical Flexible Spending Account will be permitted to incur and submit expenses through the 2020 calendar year to clear out any previously remaining unclaimed balances, if applicable.
4. Under this special provision, employees enrolled in the 2019 Dependent Care Flexible Spending Account will be permitted to incur and submit expenses through the 2020 calendar year to clear out any previously remaining unclaimed balances, if applicable.

Learn more about the IRS' Notice 2020-29.

Contact Employee Benefits at benefits@losrios.edu to determine if your situation applies to this new guidance.