The IRS has announced that they will allow flexibility in midyear elections in the calendar year 2020 for employer-sponsored health coverage, health flexible spending arrangements (FSAs), and depend-care assistance programs.
This was announced in Notice 2020-29, as part of the IRS’ response to the coronavirus pandemic.
Normally, midyear elections are only allowed during specific circumstances, like eligible change-in-status life events.
These changes can be made under a Sec. 125 cafeteria plan:
- For employer-sponsored health coverage: Eligible employees can make a new election, change elections, or revoke health coverage, so long as they submit in writing that they’ll enroll or will immediately enroll in other health coverage not sponsored by their employer.
- For health FSAs: Revoke, change, or decrease/increase an existing election
- For dependent care assistance programs: Revoke, make a new election, or decrease/increase an existing election
New flexibilities and grace periods have also been extended for health FSAs and dependent care assistance programs.
High deductible plans will also now be able to cover telehealth services.
Read more details in the Journal of Accountancy.
