Christine Oliver

Hi, Peter - Yes, I am referring to a Dependent Care Flex Spending account, 129 plan. I understand that the mid-year changes are rather flexible under this plan, and allow mid-year changes for changes in cost of daycare, but my concern with this particular requested change is does the fact that the participant knew that her child would be entering kindergarten this fall when she made her initial election prevent this from being an acceptable change?

Hello - I have a DCFSA participant requesting to reduce her annual election mid-year due to the fact that her child will be starting kindergarten this Fall. Since the participant knew that the child would be starting kindergarten this year, it doesn't seem like this would be an acceptable qualfiying event. Thoughts?

Thank you, Brian.

I am seeking clarification/regulatory guidance on the following scenario: DCFSA plan has a run-out, grace period, and spend down provision allowing reimbursement of any remaining balance upon separation of employment for eligible expenses through the run-out period (March 31st) following the end of the plan (calendar year). While we understand that leave is a qualifying event allowing participants to choose to discontinue DCFSA contributions during the leave period, allowing them to pay the contributions on a post-tax basis for that period is of no benefit to them. Given our plan provisions, once a DCFSA participant goes on an unpaid period of leave (FMLA or otherwise), shouldn't the employer automatically terminate the DCFSA for the period of unpaid leave since there are no eligible expenses during the period of leave. Given the plan provisions (and confirmation from our TPA), even though the account would be "terminated", the participant will still be able to submit reimbursement (based on available balance prior to leave period) for eligible expenses incurred prior to the leave period. So, no adverse impact for the participant and this prevents the possibility of ineligible expenses (leave period) being reimbursed. Is this position reasonable and/or do regulations speak to this?

Thanks so much Brian. Your knowledge and materials are excellent!

If an employee chooses to catch-up on their medical FSA contributions upon their return from leave and they do not have enough pays to complete the catch-up contributions prior to year end, can the employer post the remaining contributions due as post-tax contributions and take the remaining amount due in the following calendar year?

And if those without work-related computer access don't give their electronic disclosure consent, you have to mail it to home addresses, correct?

What if OE materials are only provided electronically with no consent by employees to receive electronically? Doesn't this fail the health and welfare ERISA disclosure requirements?

What if the participant repays (Gross less SS and Medicare) the overpayment in the following plan year/calendar year? Does that require a manual adjustment to the prior year's deferrals via a 1099R, match, and employer non elective contributions