GBurns

Is this person facing eminent legal action regarding the payment of these bills, or is it just theiirdesireto pay? Desire to pay should not constitute hardship nor need..

This might be useful: http://www.irs.gov/pub/irs-pdf/p969.pdf

You can contribute to both an HSA and an FSA iif the FSA is limited or special purpose. There are very specific rules which have been explained and exampled in various IRS releases/publications. However, it might be bbbest to start with BC and Lumenos for the explanations of exactly what they are offering. Have you been through this Q&A ? http://www.anthem.com/wps/portal/cdhp?cont...label=Questions ^ Answers

My humble suggestion to you is that you need to do some extensive research so that you have an understanding of the issues. While yoour employer mmight have converted from a PPO to some other form of insuraance coverage, it was not to an HSA. An HSA is a savings plan which needs to related to a High Deductible Health Plan (HDHP). The PPO most likely was replaced by an HDHP not by an HSA. In your post you stated TWO (2) different limits for the HSA contribution, which suggests your need for research.. Who is covered How, under which employer's health insurance and FSA etc etc? I have issues with other items in your post, but these should become clear to you after you do the research.. Just Google various terms involving "HSA" such as "HSA contribution limits 2010" .

As far as I recall, the limit for a medical FSA is set by each plan and not by the Treas Regs.

I am not aware of any de minimis exemption/exception in the rules, so I wonder why it would be worth the risk to do the "raffle" as jpod suggests.

James I am assuming that your post was not just spam. The insurance contract terms have nothing to do with cafeteria plan rules or the tax code.

I never got into HSAs mainly because I think that it is a bad idea, but I keep my ears open. From what I hear, what you are experiencing is fairly common with many of the large entities claiming to provide HSA services. So it is not only BofA.

While participation in an HSA requires coverage by an HDHP, participation in an HDHP does not require nor mandate an HSA. I doubt that the employer can make the HDHP conditional on the opening of an HSA. Edit: spelling error.

I advise checking not only the plan document and SPD, but also any instructions given to this employee. I know that the insurance coverage quite often requires prompt notification after birth, but I cannot see why there would be similar urgency regarding dependent care. I have not looked to see what the Proposed Treas Regs etc actually state about the timing of such a channge of election based on this change in status so I suggest that you do so yourself at www.changeofstatus.com and see what help you get.

A healthy, happy and prosperous new year to all of you. A special thank you to Dave for this excellent resource. And thank you Don, you help me close out a very bad year with a goood feeling.

In Webster's it is At(symbol) for astatine not at. The at(noun) is something else.

It seems that complacency is part of the "dumbing down" of our society. I hope that your response is not showing apathy towards my complacency regarding ending with a preposition which practice has become very common and probably soon will be acceptable. That is also not something to laugh at. Webster's also classifies "at" as a noun.

Even in an "informal" arrangement, usual and customary will come into play along with precedent. Variable pay arrangements have to be pre-arranged.

Assuming that a civilizatiion's life span is 200 years, I wonder how far along we are. I also wonder what stage we are at ? IMHO it seems we already have complacency and are getting apathy.

I think that Mr A was smart enough to leave that decision and problem to the giver. If you can give him then he can perform. It is easier to be brilliant on a hypothetical than on a practicaal action.

While it is true that you under most, if not all circumstances, you cannot pparticipate in both a general purpose FSA and an HSA, that does not seem to be the main issue here. However, to get to the main issue, I think thatt there is quite some confusion in the terminology being used. Yes you can have both an HSA and a section 125 plan. However, the connection being made is questionable. The purpose of section 125 is to allow the pre-taxing of the cost of eligible coverage including for an HSA. See IRS Pub. 969 for an explanation of the connection between the 2 plans. You need the section 125 plan for the POP. You cannot convert an "employee health plan" to an HSA. You can convert the medical coverage provided under an employee heallth plan to HDHP/HSA coverage. An HSA is not medical insurance coverage, per se, it is a means of covering supplemental eligible expenses incurred for medical care. You do not pay health insurance premiums through an FSA. A POP is not an FSA and is unrelated. So you do not amend a POP to change health insurance premiums salary reductions. You amend the Salary Reduction Agreement which is under your section 125 cafeteria plan..

Premiums that were pre-taxed are never reimburseable. That would be double dipping. See Rev Rul 2002-3. The reimbursement of premiums paid with taxed money (post tax) is addressed in Rev Rul 61-146. I am not sure that many MERPs are worded or set up for such premium reimbursement so check the plan document. I usually see a separate special MERP set up specifically for this.

As you should be able to see from the responses by other posters, it is not entirely clear to some, that we understand the OP, nor that the OP is differentiating between an HSA and the medical insurance coverage. So rather than assume, I ask further questions. It seems more sensible to let the OP clarify than to jump to conclusions.

What you are describing is usually refered to as "Benefits Credit" or "Flex Credit" and is quite popular in the public sector. Google the search term "Benefits credit FSA cafeteria plan" or similar and you should find many descrptions etc.

Not deducted pre-tax under a section 125 cafeteria plan. Post tax is after tax calculations. What is the benefit of doing so?

I usually see HSAs with contributions rather than "premiums", so I thinnk I need more info. What will be deducted through the POP? Is there an HDHP? Is there an FSA?

Abracadabra and hocus pocus !!!!

Would you be kind enough to share with us the details of the IRS opinion?

My 2 cents, The "event" of marriage caused the "changes" of Participant A gaining a dependent (spouse) and/or becoming eligible for coverage under the spouse's plan. Stopping deferrals, by itself, is not consistent with the change caused by the event. Was there also a change in medical coverage?