americanfidelity.com Open in urlscan Pro
45.60.32.124  Public Scan

Form analysis
2 forms found in the DOM

Name: MobileHeaderSearchForm — GET /search/

<form id="MobileHeaderSearchForm" name="MobileHeaderSearchForm" class="px-0" method="get" action="/search/" novalidate="novalidate" autocomplete="off">
  <div class="mobile-search-input-wrapper m-0 px-3 py-2 bg-grey7">
    <div class="input-group">
      <label for="MobileHeaderSearchInput" class="sr-only">Search Term</label>
      <input id="MobileHeaderSearchInput" type="text" name="q" class="search-input form-control input-search px-2" placeholder="Search">
      <div class="input-group-append">
        <span class="input-group-text input-search input-search-wg" id="basic-addon2">
          <label for="search-drawer" class="sr-only">Search</label>
          <button type="submit" id="search-drawer" class="search-container-icon" name="submit" tabindex="0">
            <i class="fas fa-search grey-8" role="none" focusable="false" aria-hidden="true"></i>
          </button>
        </span>
      </div>
    </div>
  </div>
</form>

GET /search/

<form id="searchForm" action="/search/" method="GET" auto-complete="false" novalidate="novalidate">
  <input id="search-modal-module" value="" type="text" name="q" class="wgm-search-input" aria-label="Search Term" placeholder="Search" autocomplete="off">
  <span class="wgm-search-modal-icon my-auto">
    <input id="search-input" aria-label="Search" class="wgm-search-modal-submit" type="submit" value="">
  </span>
</form>

Text Content

Menu
 * Search Term
   Search
 * File a Claim
   Login
 * Home
 * Benefits Strategy
    * Employee Benefits
    * Communication and Education
    * Enrollment and Admin
    * HR Assistance
    * Tax Savings
    * Compliance Updates

 * Products
    * Benefits
    * Dependent Verification
    * HR Technology
    * Reimbursement Accounts
    * Retirement Savings
    * Section 125

 * Why Us
    * For Education
    * For the Public Sector
    * For Automotive
    * Account Managers
    * Customer Testimonials

 * Blog
    * Benefits Strategy
    * Reimbursement Accounts
    * Supplemental Benefits
    * Customer Stories
    * Compliance Updates

 * Support
    * COVID-19
    * Employer Assistance
    * Videos
    * Contact Us

 * Claims
 * Careers
    * Corporate Careers
    * Sales Careers

 * About Us

   Site Map

Skip to main content
Menu File a Claim Login
American-Fidelity-logo
Menu
Menu File a Claim Login
American-Fidelity-logo
American Fidelity Logo American Fidelity Logo
 1. 
 2. Strategy
     1.  *  
         * Employee Benefits
         * Communication and Education
         * Enrollment and Admin
         * HR Assistance
         * Tax Savings
         * Compliance Updates
         *  

 3. Products
     1.  *  
         * Benefits
         * Dependent Verification
         * HR Technology
         * Reimbursement Accounts
         * Retirement Savings
         * Section 125
         *  

 4. Why Us
     1.  *  
         * For Education
         * For the Public Sector
         * For Automotive
         * Account Managers
         * Customer Testimonials
         *  

 5. Blog
     1.  *  
         * Benefits Strategy
         * Reimbursement Accounts
         * Supplemental Benefits
         * Customer Stories
         * Compliance Updates
         *  

 6. Support
     1.  *  
         * COVID-19
         * Employer Assistance
         * Videos
         * Contact Us
         *  

 7. Claims
     1.  *  
         *  

    
 8. 
    

Login
 
 


CORONAVIRUS DISEASE (COVID-19)

 

Updated as of October 2022


SECTION 125 LEGISLATION UPDATES

 * Section 125 Plan Run-Off Extension
   
   What is it:  Generally, a Run-Off Period is 90 days after the last day of the
   plan year and allows participants to submit eligible claims for
   reimbursement. The claims submitted during the run-off must have been
   incurred during the plan year. The extension announced by the Internal
   Revenue Service (IRS) due to COVID-19 is the additional time within which
   individuals may file a benefit claim under the plan's claims procedure.
   Essentially, the IRS guidance creates an “Outbreak Period” which started
   March 1, 2020 and ends 60 days after the nationally declared emergency is
   ended.  All Run-Off Periods interrupted by the Outbreak Period are extended
   for the entire Outbreak Period.
   
   How does it work: The extension applies in any situation when the Run-Off
   Period would otherwise end during the Outbreak Period. The guidance says the
   Outbreak Period is to be disregarded for purposes of determining the date
   within which individuals may file a benefit claim. This would include any
   situation when the deadline for submitting a claim (such as the end of a
   run-off period) would fall within the Outbreak Period.
   
   Note: HSA reimbursement claims would not be subject to the extension for one
   or both of two reasons. (1) HSAs are not covered by ERISA or subject to the
   ERISA claims procedure rules. (2) HSAs generally do not impose any deadline
   for submitting claims for reimbursement (“shoebox rule” applies to all
   expenses incurred after the HSA is established). 
   
   Example 1: Plans in the middle of the Run-Off Period when emergency was
   declared.
   
   A calendar year plan has a Run-Off Period for the 2019 plan year that ends
   March 31, 2020. One month (31 days) remains on the Run-Off Period when the
   Outbreak Period begins March 1, 2020. The Run-Off Period will be suspended
   during the Outbreak Period and will end 31 days after the end of the Outbreak
   Period.
   
   Example 2: Plans where the Run-Off started during the declared national
   emergency, but did not end.
   
   A non-calendar year plan with plan year ending June 30, 2020 has a 92-day
   Run-Off Period that ends September 30, 2020. Assume the Outbreak Period ends
   July 20, 2020. The first 20 days of the Run-Off Period will be suspended
   during the Outbreak Period and will not begin to run until the Outbreak
   Period ends. The Run-Off Period will end 92 days after the end of the
   Outbreak Period.
   
   Example 3: Plans where the Run-Off Period starts and ends during the declared
   national emergency
   
   A non-calendar year plan with plan year ending March 31, 2020 has a 91-day
   Run-Off Period that ends June 30, 2020. The Run-Off Period will be suspended
   during the Outbreak Period and will end 91 days after the end of the Outbreak
   Period.

 * Section 125 Plan Carryover Amount Increase
   
   What is it: Increases the carryover limit (currently $500) of unused amounts
   remaining as of the end of a plan year in a Healthcare FSA under a Section
   125 Plan that may be carried over to pay or reimburse a participant for
   eligible medical expenses incurred during the following plan year. The
   increase in the amount that can be carried over from one plan year to the
   next reflects indexing for inflation, and this indexing parallels the
   indexing applicable to the limit on salary reduction contributions under Code
   Section 125(i) of the Internal Revenue Code (Code).
   
   How does it work for employees: If your employer allows a carryover and
   adopts this increase for its Section 125 Plan, the maximum unused amount from
   a plan year starting in 2020 allowed to be carried over to the immediately
   following plan year beginning in 2021 is $550 (20 percent of $2,750, the
   indexed 2020 limit under Internal Revenue Code ("IRC") Section 125(i)). 
   
   How does it work for employers: As a general rule, an amendment to a Section
   125 Plan to increase the carryover limit must be adopted on or before the
   last day of the plan year from which amounts may be carried over and may be
   effective retroactively to the first day of that plan year, provided that the
   Section 125 Plan operates in accordance with the guidance under this notice
   and informs all employees eligible to participate in the plan of the
   carryover provision. Because IRC Code Section 125(d)(1) provides that a
   Section 125 Plan must be a written plan, a Section 125 Plan offering a
   Healthcare FSA may not utilize the increased carryover amount permitted under
   this notice for a plan year that begins in 2020 (or a later year) unless the
   plan is written in a manner that incorporates the increase by reference or
   the plan is timely amended to set forth the increased amount.
   
    
   
   UPDATE AS OF 12/27/20
   
   All unused funds in Healthcare FSAs and DCAs may be carried over to 2021
   (from plan year 2020) and 2022 (from plan year 2021). There is no carryover
   maximum.

 * Taxpayer Certainty and Disaster Tax Relief Act of 2020
   
   On December 27, new legislation for COVID-19 was announced. The provisions
   aim to provide increased flexibility for Healthcare Flexible Spending
   Accounts (Healthcare FSAs) and Dependent Care Accounts (DCAs) for the
   calendar years 2020 - 2022.
   
   Below is a brief overview of the provisions and the requirements involved in
   implementing these changes.
   
    
   
   What is changing?
   The legislative changes are an extension of relief provided through the CARES
   Act and other administrative guidance published during 2020 in reaction to
   COVID-19. Relief includes:
   
   Extended Grace Period
   
   For plan years ending in 2020 and 2021, the grace period for Healthcare FSA
   and DCA funds may be extended to 12 months
   
   Unlimited Carryover
   
   All unused funds in Healthcare FSAs and DCAs may be carried over to 2021
   (from plan year 2020) and 2022 (from plan year 2021). There is no carryover
   maximum.
   
   Election Changes
   
   For plan years ending in 2021, employees may modify their Healthcare FSA or
   DCA elections on a prospective basis at any time during the year. No
   qualifying event is required.
   
   DCA Age Increase
   
   Previously, dependents could be covered under a DCA until age 13. Through the
   end of the 2021 plan year, employers may now allow DCA reimbursements for the
   remainder of the plan year for children who turned 14 during the 2020 plan
   year.
   
   Reimbursements for Non-Active Participants
   
   Employees who cease participation in a Health FSA during 2020 or 2021 (for
   example, due to termination of employment) may continue to receive
   reimbursements from unused balances through the end of the plan year in which
   such participation ceased (including any grace period).
   
    
   
   Are the changes required?
   
   No. Employers are not required to adopt any of the changes introduced in this
   legislation. There are pros and cons to each provision, and it is up to the
   individual employer to decide which, if any, they would like to implement.
   
    
   
   What happens next?
   
   To implement these changes, American Fidelity is currently working on
   analyzing and updating processes. In the meantime, it's important for you to
   begin discussing whether you plan to adopt these provisions.
   
    
   
   What do I need to do?
   
   Employers wishing to offer any of these relief options will be required to
   amend their Section 125 Plan.
   
    
   
   Important: Your current plan design may affect which changes you see, as well
   as their timing. If you choose to allow the Extended Grace Period, Unlimited
   Carryover, Reimbursements for Non-Participants, or mid-year election changes
   for FSAs, your plan may need to be modified to accommodate the Uniform
   Coverage Risk. 

 * When is the deadline for adopting these provisions?
   
   To adopt these changes, Plans must be amended by the end of the first
   calendar year beginning after the end of the plan year in which a change took
   effect. For example, an employer must amend the plan document on or before
   Dec. 31, 2021, for changes affecting a plan year ending in 2020.

 * Are these provisions required?
   
   No. Employers are not required to adopt any of the changes introduced in the
   recent legislation. There are pros and cons to each provision, and it is up
   to the individual employer to decide which, if any, they would like to
   implement.

 * Do I have to accept all provisions, or can I pick and choose?
   
   Each provision may be added individually, or employers may choose to adopt
   all changes.

 * I am new to American Fidelity. Can you still administer any changes I choose
   to implement?
   
   Because the changes may impact benefits from prior plan years, employers who
   are new to American Fidelity will need to work with their previous Section
   125 provider to implement the changes.

 * American Fidelity no longer administers my Section 125 Plan. Can I still work
   with you to administer changes?
   
   Yes. If American Fidelity was your Section 125 Plan provider for plan years
   affected by these changes, we can help implement the provisions you choose.
   Please contact us to learn more.

 * Will adopting these provisions affect my risk?
   
   Yes. Allowing the extended grace period, unlimited carryover, reimbursements
   for non-participants, or mid-year election changes for FSAs may require
   modifications to your plan to accommodate the Uniform Coverage Risk.
   
   For example, American Fidelity’s Risk Policy does not cover mid-year election
   changes, except for employment termination. Adopting any of these changes may
   require your organization to assume any associated risk.

 * The American Rescue Plan Act of 2021 (ARPA)
   
   On March 11, 2021 an additional financial relief bill was signed into law.
   Included in the bill is a modification to Dependent Care Accounts (DCAs) for
   the calendar year 2021. Below is a brief overview of the update and the
   requirements involved in implementing the change.
   
   What is changing?
   
   For plan years starting in 2021 only, an employer may amend their Section 125
   Plan to increase the DCA maximum to $10,500. This permits DCA participants to
   prospectively increase their maximum contribution amount to $10,500 (up from
   $5,000) for married couples filing together, or $5,250 (up from $2,500) for
   single filers.
   
   This applies to DCAs only and does not impact Healthcare Flexible Spending
   Accounts. As a result, no changes to the risk policy will be required.
   
   Is the increase required?
   
   No. Like other recent legislation, this provision is not required. Employers
   must amend their plans on or before the last day of the plan year to allow
   this increased limit.
   
   What do I need to do?
   
   Section 125 Plan Documents may be retroactively amended to allow the
   increased limit. Employers must amend their plan on or before the last day of
   the plan year. Because this applies to DCA only, there is not an impact to
   the Uniform Risk. No changes to the risk policy will be required.
   
   Note: Increasing the DCA maximum could cause plan discrimination. To ensure
   your plan passes the 55% Average Benefits Test, American Fidelity recommends
   closely monitoring your DCA participation and testing accordingly. If the
   test fails, Highly Compensated Employees’ plan benefits will be taxable.

--------------------------------------------------------------------------------

We will continue to closely monitor this situation and be prepared to take any
actions necessary to assist our customers. If there are any questions regarding
coverage of our products or services, please contact us at (800) 662-1113.

AF-1447-1022

American Fidelity Assurance Company
americanfidelity.com

Back to Top

Site Map

About Us

News Center

Careers

Contact Us

 * 
 * 
 * 
 * 

© 2023 American Fidelity Assurance Company

 * Privacy Notices |
 * Report Fraud |
 * Terms of Service |
 * Licensing |
 * Special Notices |
 * Cameron Enterprises

AF-1447-1022


Search Term

Close search modal
×
Popular Topics:
 * Register for an Account
 * Forms
 * Unused FSA Funds
 * HCFSA Eligible Expenses
 * Carryovers, grace periods and runoff periods
 * HSA Eligible Expenses
 * HSA Tax Forms
 * Disability Tax Forms