| (a) Benefits available for selection by participants.
A participant may elect, in accordance with the procedures set forth
in this section, one or both of the following benefits, subject to
all the requirements and conditions contained in these rules:
(1) health care reimbursement plan;
(2) dependent care reimbursement plan.
(b) Health care reimbursement plan.
(1) General purpose health care reimbursement account.
Pursuant to the health care reimbursement plan, a participant may
elect to receive reimbursements of certain health care expenses which
are excludable from the participant's taxable income. The general
purpose health care reimbursement account is intended to be qualified
under the Code, §105, is an optional benefit under the flexible
benefits plan, and constitutes a separate written employee benefit
plan as contemplated by the Code, §105, and Treasury Regulation
1.105-11.
(2) Maximum benefit available. Subject to the limitations
set forth in these rules, hereafter referred to as the plan, to avoid
discrimination, the maximum amount of flexible benefit dollars that
an employee may receive in any plan year for health care expenses
under the health care reimbursement plan is the amount permitted under
the Code, §105. Even if permitted under the Code, in no event
shall the amount available exceed $5,000 in a plan year. An employee
may prepay the health care election amounts for the remainder of the
plan year in anticipation of termination, retirement, or a period
of leave without pay.
(3) Limited purpose health care reimbursement account.
An employee who elects to participate in a consumer directed health
plan with a health savings account as permitted by Subchapter J, Chapter
1551, Insurance Code, may elect to participate in a limited purpose
health care reimbursement account. This limited purpose health care
reimbursement account may only be used to reimburse eligible dental
and vision care expenses incurred during the benefit plan year or
permitted carryover period. The limited purpose health care reimbursement
account is intended to be qualified under the Code, §105, is
an optional benefit under the flexible benefits plan, and constitutes
a separate written employee benefit plan as contemplated by the Code, §105,
and Treasury Regulation 1.105-11.
(c) Dependent care reimbursement plan.
(1) Pursuant to the dependent care reimbursement plan,
a participant may elect to have payments made or receive reimbursement
for dependent care expenses. The dependent care reimbursement plan
is intended to be qualified under the Code, §129, is an optional
benefit under the flexible benefits plan, and constitutes a separate
written employee benefit plan as contemplated by the Code, §129.
(2) Maximum benefit available.
(A) Subject to any limitations imposed by these rules,
hereafter referred to as the plan, to avoid discrimination, the maximum
amount that an employee may receive in any plan year in the form of
payment of or reimbursement for dependent care expenses under the
dependent care reimbursement plan is the lesser of:
(i) the employee's earned income for the plan year
(after all reductions in compensation including the reduction related
to dependent care expenses);
(ii) the earned income of the employee's spouse for
the plan year; or
(iii) the amount permitted under the Code, §129.
Even if permitted under the Code, in no event shall the amount available
exceed $5,000 in a plan year.
(B) In the case of a participant's spouse who is a
full-time student at an educational institution or who is physically
or mentally incapable of caring for himself, such spouse shall be
deemed to have earned income of not less than $200 per month if the
participant has one dependent and $400 per month if the participant
has two or more dependents in accordance with the Code, §21.
|
| Source Note: The provisions of this §85.5 adopted to be effective August 12, 1988, 13 TexReg 3754; amended to be effective September 28, 1989, 14 TexReg 4787; amended to be effective September 1, 1990, 15 TexReg 4646; amended to be effective September 1, 1991, 16 TexReg 3779; amended to be effective September 1, 1992, 17 TexReg 2874; amended to be effective September 1, 1994, 19 TexReg 3765; amended to be effective February 12, 1998, 23 TexReg 1313; amended to be effective September 16, 1999, 24 TexReg 7276; amended to be effective July 10, 2000, 25 TexReg 6557; amended to be effective July 17, 2003, 28 TexReg 5539; amended to be effective May 29, 2005, 30 TexReg 3022; amended to be effective December 31,2007, 32 TexReg 10054; amended to be effective June 13, 2011, 36 TexReg 3596; amended to be effective June 6, 2016, 41 TexReg 4045 |
