On May 12, 2020, the IRS issued Notice 2020-29, giving employers the option to make changes to a § 125 cafeteria plan that would allow eligible employees to make prospective midyear elections and changes to existing elections during 2020 as follows:
- With respect to employer-sponsored health coverage under fully insured and self-insured plans:
- Make a new election on a prospective basis, if the employee initially declined to elect employer-sponsored health coverage;
- Revoke an existing election and make a new election to enroll in different health coverage sponsored by the same employer on a prospective basis; and
- Revoke an existing election on a prospective basis, provided that the employee attests in writing that the employee is enrolled, or immediately will enroll, in other health coverage not sponsored by the employer.
- Revoke an election, make a new election, or decrease or increase an existing election applicable to a health FSA on a prospective basis.
- Revoke an election, make a new election, or decrease or increase an existing election regarding a dependent care assistance program on a prospective basis.
