Two more changes to FSA/DCAP rules due to COVID-19

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In June and September, your employees have a special opportunity to change their Medical FSA and DCAP elections without a qualifying event.

Since we let you know about these opportunities, two more changes have occurred: The IRS has announced a new DCAP maximum annual election and new eligible expenses for Medical FSA funds.

New DCAP maximum annual election

The IRS has announced a new, temporary DCAP election maximum of $10,500 for a single person or married couple filing jointly (or $5,250 for married couples filing separately).

Employees can take advantage of the new, temporary DCAP maximum by making an election change only in June or September (unless they experience a qualifying event that allows an election change outside those two months).

To make election changes, employees should submit the SEBB Change in Status form to their payroll and benefits office during the month of June or September. New employees can also elect up to the temporary maximum if they choose to enroll in DCAP.

Personal protective equipment now eligible Medical FSA expenses

The IRS has announced that personal protective equipment (PPE) related to the COVID-19 pandemic are now eligible health care expenses — including face masks (disposable or cloth), mask kits, hand sanitizer, and sanitizing wipes. Employees can submit claims for PPE expenses dating back to January 1, 2021.

Employees will be notified in early May

We will notify employees about these additional changes through an email from Navia in early May and in the SEBB Intercom newsletter going out by mail and email on May 19.

If your employees have questions, please refer them to the SEBB Program’s announcement about the changes.