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forgot to re-enroll: HSA, Dependent Care FSA

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  • forgot to re-enroll: HSA, Dependent Care FSA

    employer requires me to re-enroll each year in HSA and DC FSA, didn't realize this since it's always been automatic before.

    1) I can just directly fund my HSA up to IRS contribution limit right? Doesn't have to be payroll deduction IIRC?

    2) Any creative workarounds for DC FSA? I can't set up a self directed on based on my IC income for that right? It's annoying that I was dropped from this/screwed it up as it was $5k of tax free child care each year.

  • #2
    By law the FSAs need active re-enrollment each year. I think the HSA election can rollover.

    You can write a check into your HSA for the full amount today if you want to. You'll just have to settle out the taxes next April. Or you can jack up your payroll deductions to cover the max more quickly. Just don't forget to turn them off when you hit the limit.

    I'm not aware of any other avenue to get DCFSA other than through employer. You can ask your HR if you can get enrolled. Call it an oversight or mistake. Some employers make exceptions for these kinds of administrative errors.

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    • #3
      1. Yes. You'll lose the money on FICA is all so not much.
      2. You should talk to your employer about this. The Consolidated Approprations Act of 2021 waived the limited circumstances for mid-year FSA election changes and allows changes for any reason whatsoever. That's probably your best bet, and hopefully they've amended (or will amend) the plan to allow this. Unless you're a C corp, you couldn't participate in a cafeteria plan if you're a sole proprietor or >2% S corp owner.

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      • #4
        1. HSA contributions by salary reduction do not require enrollment or a QLE. You can change them at any time subject to plan limitations.
        2. A DCFSA requires an employer plan. As pointed out by jhwkr542, pass-thru business owners can not receive pre-tax health and welfare benefits. You would need a qualifying life event (QLE) thru your W-2 employer's plan, but maybe there is some pandemic related rules.
        Last edited by spiritrider; 01-20-2021, 07:19 PM.

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        • #5
          You having a life changing event this year? Like another baby? If so, you should be able to enroll at that time for the FSA.

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          • #6
            Originally posted by SLC OB View Post
            You having a life changing event this year? Like another baby? If so, you should be able to enroll at that time for the FSA.
            doubt we will.

            do you think they'd count getting a puppy? might help me convince my wife.

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            • #7
              Originally posted by MPMD View Post

              doubt we will.

              do you think they'd count getting a puppy? might help me convince my wife.
              Is it an emotional support puppy?

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              • #8
                Originally posted by Lordosis View Post

                Is it an emotional support puppy?
                aren't all puppies emotional support puppies dude?

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