The open enrollment period allows you to review, change or continue benefit elections every year. Keep in mind that benefit plan changes are only allowed throughout the plan year if it is during open enrollment or you have a qualified Section 125 event. During open enrollment, you can do the following:
A Section 125 Plan provides a tax-saving way to pay for eligible medical or dependent care expenses. The funds are automatically deducted from your paycheck on a pre-tax basis.
A Section 125 Plan reduces your taxes and increases your spendable income by allowing you to deduct the cost of eligible benefits from your earnings before tax. Plus, the plan is available to you at no cost, and you’re already eligible – all you have to do is enroll.
The savings you may experience with a Section 125 Plan are outlined in the example below. For instance, you could potentially take home about $70 more each month if you participated in your employer’s Section 125 Plan – that’s a savings of $840 a year!
You cannot change your benefit elections for the plan year unless the benefits office receives notification in writing within 31 days of the status change. If the benefits office is not notified within 31 days of the status change, no benefit change can be made until the next annual open enrollment.
IRS specified changes in family status include:
| Monthly Salary | $2,000 |
|---|---|
| Less Medical Deductions | – N/A |
| Taxable Gross Income | $2,000 |
| Less Taxes (Fed/State @ 20%) | -$400 |
| Less Estimated FICA (7.65%) | -$153 |
| Less Medical Deductions | -$250 |
| Take Home Pay | $1,197 |
| Monthly Salary | $2,000 |
|---|---|
| Less Medical Deductions | -$250 |
| Taxable Gross Income | $1,750 |
| Less Taxes (Fed/State @ 20%) | -$350 |
| Less Estimated FICA (7.65%) | -$133 |
| Less Medical Deductions | – N/A |
| Take Home Pay | $1,267 |
*The figures in the sample paycheck above are for illustrative purposes only.
This site contains a summary of the benefits offered by your employer. If there is a conflict between the terms of this outline of benefits and the actual contracts, the terms of the contracts will prevail.
