New Mexico State University offers both a healthcare flexible spending account and a dependent day care flexible spending account. Both plans allow employees to use pre-tax dollars to pay for out of pocket health care expenses and dependent day care expenses. The maximum annual election for the health care FSA is $2,750 and the maximum annual election for the dependent day care FSA is $5,000.
This benefit is available to eligible employees and their dependents. Eligible employees are considered regular status employees and non-regular term appointment employees working 30 hours or more per week. Eligible dependents may include spouse, qualified domestic partner, children to age 26 (the end of the month in which age 26 is attained), and disabled children age 26 or older.
Cafeteria plan document – revised July 2015
New eligible employees may enroll by completing and submitting the FSA Enrollment Form within their first 31 days of employment. Benefits are effective the first of the month after the enrollment form is received. Otherwise, existing employees may enroll annually during the Open Enrollment process (fall) by completing a 2022 Open Enrollment Form.
The flexible spending account may be changed in specific circumstances when the employee experiences a change in status/qualifying event. Request for change must be made within 31 days from the date of the qualifying event and supporting documentation of the change is required. Changes in coverage will become effective the first of the month following the change in status effective date.
Health care flexible spending accounts are available to eligible employees and their covered dependents. Employees may elect up to $2,750 per plan year on a pre-tax basis. Elections may be used to reimburse Employees’ out of pocket medical, dental and vision costs. Items eligible for reimbursement include, but are not limited to, co-pays, deductible amounts, and co-insurance amounts. The plan year begins January 1st and ends December 31st. All eligible expenses must be incurred during the plan year.
- Estimate your health care expenses for the year.
- Decide how much to contribute. Your contributions will be deducted from your pay on a pre-tax basis each pay period and deposited in your account with McGriff Insurance Services.
- Use your McGriff Benefit Access Visa Debit Card to pay for your eligible expenses (be sure to save original itemized receipts for every transaction); OR
- Pay your health care expenses as you normally would.
- Submit your reimbursement request claim form along with your explanation of benefits from your insurance carrier or an itemized statement from the provider you are requesting reimbursement for.
- Receive reimbursement for the amount eligible (up to the annual amount you elected at enrollment).
Participants must file all claims for the current plan year within 3 months of the end of the plan year. Balances in excess of $550 left in the Health Care FSA at the end of the filing period will be forfeited. Per IRS guidelines, the plan allows up to $550 of unused monies to be carried over to the next plan year.
What does this mean?
This new feature means that all current Health FSA participants for the plan year will have the opportunity to “carry over” up to $550 of their unused balances to the new plan year. It also means, that any participants in future plan years will also have the same carry over option.
How will this work?
All employees who sign up for the Health FSA for the new plan year will have the same opportunity to carry over up to $550 to the next plan year. As of December 31st of each year, the participant will have 3 months to file any claims incurred from January 1 through December 31. Once all claims have been filed and paid, any unused balances, up to $550, will be rolled over to the new plan year for use.
What if a participant leaves employment before the end of the plan year?
If a participant leaves employment prior to the end of the FSA plan year (December 31st), the participant has two options:
- The participant can elect to continue coverage with post-tax contributions through COBRA. All pre-tax monies in the account and any post-tax contributions added to the account can be used to pay claims filed from January 1st through the last day COBRA is paid or the last day of the plan year, whichever is first. The $550 carry over option WILL NOT be available to COBRA participants, so all monies must be used to pay for claims incurred during the plan year. All unused monies will be forfeited.
- The participant can opt out of continuation through COBRA and the participant will have 3 months from the last day of employment to submit claims incurred between January 1st and the last day of employment. All unused monies will be forfeited.
What if the participant chooses not to enroll in the Health FSA for the next plan year?
If a participant chooses not to enroll in the next plan year, all monies in the Health FSA will be available for claims incurred during the plan year in which the employee was last a participant. The participant still has 3 months after the end of the plan year to submit the claims for the prior plan year. The carryover amount will be available for the participant to use in the next year, unless the employee terminates/leaves employment. The employee would simply file claims as usual for the unused amount throughout the next plan year but will not be adding any new monies through payroll deduction.
What if an employee signs up for the Health FSA after January 1st as a new hire?
All the same rules apply, except as a new employee who starts participation after January 1st, all claims submitted for payment must fall within the employees’ first day of coverage and the end of the plan year. Claims for services prior to the employee’s first date of coverage will not be eligible for reimbursement through the Health FSA. The participant is still eligible for the $550 carry over at the end of the plan year.
Dependent Day Care Flexible Spending Account
Dependent day care flexible spending accounts are available to eligible employees and their covered dependents. For dependent day care expenses to be eligible for reimbursement, the care must make it possible for you to work and must be for an eligible dependent. A person who qualifies as an eligible dependent may be a child under the age of 13 or an adult dependent who is physically or mentally incapable of caring for himself or herself and regularly spends at least eight hours a day in your home. Employees may elect up to $5,000 per plan year on a pre-tax basis. For married couples, the household annual election limit is $5,000 – if a couple files a joint tax return their total election cannot be greater than $5,000. If a married couple files separate tax returns, each spouse individually can only elect up to $2,500. Elections may be used to reimburse Employees’ out of pocket dependent day care expenses. Eligible expenses that the Internal Revenue Service allows you to be reimbursed through the Dependent Day Care Account are generally those expenses that are tax deductible on your income tax return. If married, both spouses must be working or going to school while the dependent is receiving care. If the care is provided by a dependent care center, the center must comply with all applicable state and local laws and regulations. Before and after school care for children from kindergarten to age 13 is eligible. Summer day camp (does not include overnight camp) may also qualify for reimbursement. The plan year begins January 1st and ends December 31st.
- Estimate your dependent day care expenses for the year.
- Decide how much to contribute. Your contributions will be deducted from your pay on a pre-tax basis each pay period and deposited in your account with Stanley, Hunt, Dupree & Rhine.
- Use your McGriff FSA Request Benefit Access Card to pay for your dependent daycare expenses (be sure to save original itemized receipts for every transaction); OR
- Pay your dependent day care expenses as you normally would.
- Submit your reimbursement request claim form. For reimbursement of Dependent Day Care Expenses, you must have your Day Care Provider sign and date the claim form or you may submit an itemized receipt from the provider you are requesting reimbursement for.
- Receive reimbursement for the amount eligible (up to the amount being held in your flexible spending account at the time). Amounts reimbursed cannot exceed the available amount in the flexible spending account at the time reimbursement is requested.
You must use all the money in your account by the end of the plan year. According to IRS guidelines, any money left over in your account at the end of the year will be forfeited. However, you have 90 days after the plan year to file a claim for reimbursement of eligible expenses incurred during the plan year