Flexible Spending Accounts (FSAs), administered by [FSA Carrier], allow you to set aside pre-tax dollars to pay for eligible health and dependent care expenses. As an eligible employee, you may choose to enroll in one or both Flexible Spending Accounts. Each year, you must elect the annual amount you want to contribute to each account. Your contributions will be deducted pre-tax from your paycheck which can help reduce your taxable income.

Health Care FSA – IRS Annual Maximum $x: Your Health Care FSA will reimburse you for eligible expenses that you, your spouse[/domestic partner], and your children incur during the plan year. The entire annual amount you elect can be used at any time during the plan year even though your contributions are deducted each paycheck. When you incur an eligible expense, you can use your [FSA Carrier] debit card or pay out-of-pocket and submit a reimbursement request with documentation.

Eligible expenses include copays, coinsurance, deductibles, orthodontia, glasses/contact lenses, and much more. For a complete list, refer to IRS Publication 502: Medical and Dental Expenses, available at www.irs.gov/publications.

[Note: if you are enrolled in the HDHP with HSA, you are not eligible to participate in the Health Care FSA.]

Limited Purpose FSA – IRS Annual Maximum $x: HDHP with HSA participants are eligible to participate in the Limited Purpose Health Care FSA to set aside pre-tax dollars for eligible dental and vision expenses only.

Dependent Care FSA – IRS Annual Maximum $x: Your Dependent Care (or daycare) FSA lets you use “before-tax” dollars to pay daycare expenses for children age 12 and under, or for elder dependents unable to care for themselves. The care must be necessary for you and your spouse to remain employed. Care may be provided through live-in care, babysitters, or licensed daycare centers. Unlike the Health Care FSA, you can be reimbursed only up to the amount available in your account after your payroll contributions.

If you enroll in the High Deductible Health Plan (HDHP), you may be eligible to open a Health Savings Account (HSA) through [CARRIER] to help pay for eligible health care expenses no covered under your medical, dental or vision plan. An HSA makes it easier to pay for current health care costs and save for future health care needs now or into retirement.

An HSA offers the opportunity for you to set aside tax-free* money to pay for out-of-pocket health care expenses. Since the HSA is your bank account, the unused funds roll over year to year. If you leave the company, the account goes with you. HSAs are also a great retirement savings account. You can contribute up to the annual IRS maximums (including the age 55+ catch-up contributions) with pre-tax dollars to pay for health care after you retire. 

[CLIENT NAME] will contribute to your HSA in quarterly installments. In other words, [CLIENT NAME’S] full annual contribution will not be available to you at the beginning of the year; rather their contributions will accrue over the course of a year. All contributions (including the amount [CLIENT NAME] contributes) to the HSA must not exceed the maximums set by the IRS each year.

How do I get the employer contribution?

You must first open an HSA to be eligible for employer contributions. [ABC] will automatically contribute to your HSA each [quarter], [month], [pay period]. Company contributions will be added and accrue over the course of the year. In 2018, [ABC] will deposit up to $x annually for individual coverage and up to $x annually for family coverage. [ABC] contributions to the HSA are pro-rated based on your effective date on the HSA.

How do I get reimbursed?

When you enroll in an HSA, you will receive a [HSA Carrier] debit card to pay for eligible expenses. You can also submit claims online through your own personal account at [HSA Website]. 

Are HSAs really tax-free?

Yes! HSAs give you a triple tax advantage: your contributions to the HSA are not taxed, payment of qualified expenses is tax-free, and earnings are tax-free.*

Keep in mind, there are a few important rules you need to follow. If you use your HSA funds for expenses the IRS considers eligible, the money remains tax-free.* If you use funds for ineligible expenses, you will pay applicable taxes and an excise tax penalty (currently 20%). 

What about the fine print? 

• You must be enrolled in a qualified High Deductible Health Plan (HDHP).
• You cannot be covered under another non-qualified health plan, including your spouse’s Health Care Flexible Spending Account.
• You cannot be enrolled in Medicare or Tricare.
• You cannot be claimed as a dependent on someone else’s tax return.

Questions? Refer to IRS Publication 969 for complete rules.

*State taxes may still apply in CA, NJ, and AL. For detailed tax implications of an HSA, please contact your professional tax advisor.

Learn more about the HSA and how it works 

The [Commuter Carrier] commuter benefits program allows employees who commute to and from work to set aside pre-tax funds to pay for their work-related mass transit and parking expenses. Eligible expenses for the transit benefit include transit passes, fare cards, ticket books, and vanpool expenses.

You may deduct pre-tax money from your paycheck to pay for commute-related expenses which reduces your taxable income. The maximum contribution is:

• Transit: $x monthly
• Parking: $x monthly

Retirement readiness is an important part of overall financial wellness. The [ABC] Company 401(k) Plan administered by [401(k) Carrier] offers a variety of investment options. [ABC] generously matches up to [$x] of employee 401(k) contributions to help grow your retirement savings.

Eligibility

You are eligible to participate in the 401(k) plan [on your first day of employment] [after x days of employment] at [ABC]. When eligible, you may enroll in the 401(k) plan, designate beneficiaries, and allocate your asset distribution at any time. You do not need to wait for annual enrollment to make changes.

Personal contributions are pre-tax (or post-tax if enrolling in a Roth 401(k)) and are added to your account conveniently through payroll deductions.

Company 401(k) Contributions

The key to a successful retirement is to start saving now! [ABC] will match employee contributions dollar-for-dollar up to x%. [Your personal funds and contributions made by the company are immediately vested. This means the funds in your account are 100% yours.] [Company contributions are vested according to the following vesting schedule:]

Company 401(k) Contributions

The key to a successful retirement is to start saving now! [ABC] will match employee contributions dollar-for-dollar up to x%. [Your personal funds and contributions made by the company are immediately vested. This means the funds in your account are 100% yours.] [Company contributions are vested according to the following vesting schedule:]

Advantages of a Roth 401(k)

Traditional 401(k) contributions are pre-tax, so you don’t pay taxes until you withdraw the money in retirement. Roth 401(k) distributions are post-tax, so you pay taxes during the year when you make contributions, but you don’t pay taxes when you withdraw the funds in retirement. Funds grow tax-free in a Roth account.

While you may elect to make contributions to both a traditional 401(k) and a Roth 401(k), you may only contribute a combined total of $x per year. If you’re age 50 or older, you can make “catch up” contributions up to $x per year. You don’t need to make a separate election to contribute additional “catch up” funds. Your contributions will simply continue until you meet the annual “catch up” limit.

Short Term Disability (STD)

Short-Term Disability coverage, through [STD Carrier], provides you with a portion of income replacement if you are unable to work due to a non-occupational illness or injury. You are automatically enrolled in STD at no cost to you.

The STD plan provides x% of your weekly salary, to a maximum of $x per week for the first x days of a disability (after a x-day waiting period).

STD benefits may be offset by benefits you receive from the state-mandated disability plans in California, New Jersey, New York, Rhode Island or the Commonwealth of Puerto Rico.

Supplemental Information:

• STD Benefit Summary

Long Term Disability (LTD)

Long-Term Disability coverage, through [LTD Carrier], pays you a portion of your earnings if you cannot work for an extended time due to a disabling illness or injury. You are automatically enrolled in LTD at no cost to you.

LTD coverage replaces x% of your base salary to a monthly maximum of $x if you are disabled for more than x days and are unable to work. You will continue to receive benefits if you meet the definition of disability or reach your Social Security Normal Retirement Age.

Benefits are reduced by other sources of disability income you may qualify for such as Social Security and Workers’ Compensation.

Supplemental Information:

• LTD Benefit Summary