Once you enroll in the Simple HR Cafeteria Plan and start your pre-taxed payroll deductions, you are obligated to remain the plan until the next open enrollment period UNLESS you have an “IRS qualifying event” such as:
One of the IRS regulations requires employers to place certain limits on when their employees can change the elections they make under the plan. You CANNOT simply decide to opt out of the Simple HR Cafeteria Plan later in the plan year because you feel like it. Your payroll deductions are tax-sheltered and the IRS enforces strict guidelines with Employers to ensure they are maintaining compliance with cafeteria plans. When you enroll, you sign an election form at the time of application which states that the election will remain in effect and cannot be revoked or changed during the plan year unless the revocation or new election is due to a change in status (as listed above).
One major exception to this rule that Simple HR will allow in their plan is for POST-TAX Benefits. Because a post-tax payroll deduction does not affect the participant’s taxable wages in any way, an employee may stop their payroll benefit deductions at any time during the year. They may not, however, restart or enroll in any other benefit until the next open enrollment period.
Please contact the Simple HR Benefits Department for further information.
