IRS Issues Guidance on Application of ‘Windsor' Decision on FSAs, HSAs

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Cafeteria plans can permit midyear election changes for plan participants who were legally married to same-sex spouses as of June 26, the date of the U.S. Supreme Court's decision in United States v. Windsor, the Internal Revenue Service said in Notice 2014–1.
“A cafeteria plan may permit such a participant to revoke an existing election and make a new election in a manner consistent with the change in legal marital status. For purposes of election changes due to the Windsor decision, an election may be accepted by the cafeteria plan if filed at any time during the cafeteria plan year that includes June 26, 2013, or the cafeteria plan year that includes December 16, 2013,” the IRS said in the notice, which mostly took the form of questions and answers addressing the implications of the decision on cafeteria plans and health savings accounts.
Plans also are able to permit a midyear election change for participants marrying a same-sex spouse after the Windsor decision, the IRS said.

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