The Internal Revenue Service issued guidance Tuesday to make temporary changes to section 125 cafeteria plans, with the goal of providing tax relief and flexibility in the midst of the novel coronavirus pandemic. The IRS is extending the claims period for health care flexible spending arrangements and dependent care assistance programs and enabling taxpayers to make mid-year changes to their accounts.
The guidance released Tuesday by the IRS deals with the unanticipated changes in expenses faced by many taxpayers as a result of the COVID-19 pandemic. The IRS is now allowing its previously provided temporary relief for high deductible health plans to be applied retroactively to Jan. 1, 2020, and also increases for inflation the $500 permitted carryover amount for health FSAs to $550.
Mike Cagney is the co-founder and chief executive officer of Figure.
As chief product & technology officer, Jess will lead Duck Creek's product vision to drive value for customers, partners and system integrators.
Jess is a champion of improving the customer experience and leads with a forward-thinking attitude toward deepening the connection between products. Prior to joining Duck Creek, Jess worked at ZoomInfo Technologies Inc. (NASDAQ GS: ZI), a leading go-to-market intelligence platform, and UKG, a multinational technology company providing workforce and human resource management services, where she led product and engineering teams that delivered innovative multi-channel solutions and thought leadership to customers.
Jess joined Duck Creek on April 11, 2022 with more than 15 years of experience delivering B2B products at an enterprise scale across multiple industries. Jess has been featured in multiple publications and spoken at events within the software community on the topics of creating product vision, fostering a culture of innovation, improving the employee experience, women in technology, and authenticity in the workplace. Jess earned her Bachelor of Business Administration degree from the University of Massachusetts – Amherst, as well as her Juris Doctorate from the Washington College of Law at American University.
Jamie Hale is the CEO and Co-Founder of Ladder, the award-winning life insurtech helping more people get covered in an instant, easy, and affordable way. Rooted in personal experience, Jamie's deep belief that life insurance is a fundamentally good product for families and communities inspired him to build Ladder and close the $16T coverage gap. Prior to co-founding Ladder, Jamie was Partner at Aldenwood Capital and at Jasper Ridge/Oak Hill Investment Management. He also worked at NextCard, pioneering instant credit and the first 'internet enabled' Visa card. Jamie is a graduate of Bowdoin College and Harvard Business School.
In Notice 2020-29, the IRS is offering extra flexibility to taxpayers by:
- extending the claims periods for taxpayers to apply unused amounts remaining in a health FSA or dependent care assistance program for expenses incurred for those same qualified benefits through Dec. 31, 2020;
- expanding the ability of taxpayers to make mid-year elections for health coverage, health FSAs and dependent care assistance programs, allowing them to respond to changes in needs as a result of the COVID-19 pandemic; and
- applying earlier relief for high-deductible health plans to cover expenses related to COVID-19, and a temporary exemption for telehealth services retroactively to Jan. 1, 2020.
In conjunction with that notice, the IRS also issued Notice 2020-33, in response to the Trump administration’s Executive Order 13877, which directs the Treasury secretary to “issue guidance to increase the amount of funds that can carry over without penalty at the end of the year for flexible spending arrangements.” The notice ups the limit for unused health FSA carryover amounts from $500, to a maximum of $550, adjusted each year for inflation.
