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Core Documents Produces YouTube Video About Section 125 Health FSA Plans

December 17, 2013

What’s new with Health FSA plans in a post-ACA health insurance America? Here’s an “Executive Summary” YouTube video about Section 125 Health FSA Plans.

A “Post-ACA Mandates” Section 125 Health FSA Plan means:

The Internal Revenue Service released Notice 2012-40 provides guidance on the application of the Affordable Care Act’s $2,500 limit on employee pre-tax contributions to health fsa’s. Effective for plan years after December 31, 2012 Health Care Reform (ACA, ObamaCare) limits Health FSA contributions to $2,500 per plan year for employee contributions. Employers may also contribute to a Health FSA (flex credits) in excess of the $2,500 annual limit.

A cafeteria plan offering a health FSA will need to be amended to comply with the $2,500 limit. If a cafeteria plan that includes a Health FSA is not timely amended, it fails to qualify as a cafeteria plan or Health FSA and all employee elections of nontaxable benefits under the plan (e.g., health FSA salary reductions and health plan premium payments) must be included as gross income to the employees.

New $500 Carryover of Unused Funds for Health FSA plans in 2014

And, effective in plan year 2014, employers that offer FSA programs will have the option of allowing participants to rollover, or carryover up to $500 of unused funds at the end of the plan year.

Effective immediately, employers that offer FSA programs that do not include a 2.5 month grace period will have the option of allowing employees to roll over up to $500 of unused funds at the end of the current 2013 plan year.

From: IRS Modifies “Use-or-Lose” Rule for Health Flexible Spending Arrangements Press Release


IRS Notice 2013 -71 – Modification of “Use-or-Lose” Rule For Health Flexible Spending Arrangements (FSAs)and Clarification http://www.irs.gov/pub/irs-drop/n-13-71.pdf

“In a post-ACA health insurance America, with more out-of-pocket medical expenses, higher deductibles and co-payments, plus dental, vision, and Rx expenses, every employee should utilize the Section 125 Health FSA deduction to save money.” GCE

Video About Section 125 Health FSA Plans

The President of Core Documents, Gene C. Ennis has held:

  • Certification in Flexible Compensation, (CFC) by the Employers Council on Flexible Compensation,
  • a 218 Life and Health Insurance license offering Section 125 plans since 1989,
  • a Third Party Administrator’s (TPA) license administering ERISA self-funded health and welfare plans,
  • a Professional Employer Organization (PEO) license with co-employer responsibility for 500 work site employees, and,
  • a PEO Controlling Person’s license.

Core Documents retains the services of several ERISA Benefit Attorneys for up to the minute commentary on issues affecting plan document language and administration. Our plan documents have been thoroughly reviewed by numerous CPAs and law firms who have found them to be clear, concise, compliant and cost effective.

Core Documents has been providing Section 125 Health FSA plans for small business owners since 1997. They
would be happy to assist you in establishing your own custom Section 125 Health FSA plan document and administrative kit for only $129. Call us today at 1-888-755-3373 and talk to a Plan Consultant about how we can assist you and reduce 2014 income tax liability.

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