Client Alerts

Important Cafeteria Plan Reminder for Employers

If you took advantage of any of the various COVID-19 special rules for your cafeteria plan, your cafeteria plan must be amended to reflect those provisions by December 31, 2022, for calendar year plans.  Those special COVID-19 special rules include:

  • Health FSA reimbursement of menstrual products, OTC drugs without prescription, PPE [personal protective equipment with primary purposes of preventing spread of COVID-19]
  • Health FSA ability to make election change without a requirement and unlimited carryover, grace period through year end, spend down
  • Dependent Care FSA maximum increase to $10,500 and age increase to 14
  • Dependent Care FSA ability to make election change without a requirement and extended grace period through year end

The COVID-19 special rules allowed a cafeteria plan to use the special rules without amending that cafeteria plan at that time.  Amendment of the cafeteria plan to reflect the special rules could be delayed until December 31, 2022, for calendar year plans.

Note:  This amendment requirement applies even though many of the COVID-19 special rules were temporary and no longer apply.  The cafeteria plan document still needs to be amended to reflect that you took advantage of the special rules.

Some cafeteria plan vendors amended the cafeteria plans at the time the COVID-19 special rules were used.  Other vendors did not amend at that time.

To Do:

  1. Check what you did.  Did you use any of the COVID-19 special rules?
  2. heck your cafeteria plan document.  Did you amend your cafeteria plan document at that time?
  3. Check with your cafeteria plan vendor.  Did your vendor amend your cafeteria plan document at that time?
  4. Pay particular attention to the cafeteria plan documentation if you changed cafeteria plan vendors.  Did the first vendor amend?  If not, you will need to work with the new vendor to get the current cafeteria plan document amended to reflect what happened with the prior cafeteria plan vendor.

If you have any questions about the foregoing items, or need assistance bringing your plans, policies, or notices into compliance, please contact us.