Q: An employee said they want to save money in December to buy holiday presents. They don’t anticipate needing to use our health coverage. Can we let them stop paying their pre-tax payroll premiums just for the one month?
A: No. Once enrolled, employees generally cannot stop or reduce pre-tax health coverage contributions midyear unless they experience a qualifying event under IRS section 125 rules (such as marriage, divorce, or loss of other coverage). Wanting to save money or skip coverage for a month does not qualify. The employee must continue contributions until the next open enrollment or an eligible life event occurs.
Benefit Allocation Systems (BAS) provides best-in-class, online solutions for: Employee Benefits Enrollment; COBRA; Flexible Spending Accounts (FSAs); Health Reimbursement Accounts (HRAs); Leave of Absence Premium Billing (LOA); Affordable Care Act Record Keeping, Compliance & IRS Reporting (ACA); Group Insurance Premium Billing; Property & Casualty Premium Billing; and Payroll Integration.
MyEnroll360 can Integrate with any insurance carrier for enrollment eligibility management (e.g., Blue Cross, Blue Shield, Aetna, United Health Care, Kaiser, CIGNA and many others), and integrate with any payroll system for enrollment deduction management (e.g., Workday, ADP, Paylocity, PayCor, UKG, and many others).
This article is for informational purposes only and is not intended as legal, tax, or benefits advice. Readers should not rely on this information for taking (or not taking) any action relating to employment, compliance, or benefits. Always consult with a qualified professional before making decisions based on this content.
