As this Congress wanted to wish us well for the holidays they passed the Consolidated Appropriations Act, 2021 (CAA). Below please find some highlights for those factors that may affect health and welfare plans. This assumes the President signs the bill into law—he is currently threatening to veto it in favor of either a clean bill (stand-alone bill) or that the amount of COVID-stimulus payments to eligible households be increased from $600 to $2000.
Under the CAA, employers sponsoring HCFSA (Health Care Flexible Spending Accounts, both regular and limited purpose FSAs) and DCAPs (Dependent Care Assistance Plans, aka Dependent Care Reimbursement Accounts) may elect to adopt some or all of the following changes:
Employers electing to adopt any or all of these changes may implement them immediately and then amend their plan documents in the following calendar year. Employers should also talk with their FSA administrators to ensure that they’ll be able to administrator the changes and consult with your Account Managers/Sales Executives about any additional impact these choices may have with regard to other plans that participants have elected for 2021.
If you are interested in any other aspects of the CAA, here’s a solid summary from the Journal of Accountancy. https://www.journalofaccountancy.com/news/2020/dec/tax-provisions-in-covid-19-relief-bill-ppp-and-business-meal-deductibility.html
Footnotes & Links:
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