Why is there no option to indicate “pre-tax” for health FSA and dependent care (DCRA) benefits in Wrap360?

Although written documentation for pre-tax health FSA contributions and dependent care (DCRA) benefits is required by Section 125 of the Internal Revenue Code, the Wrap360 system currently only provides documents for Premium Conversion Plans. We do not provide Section 125 documents for either health FSA or dependent care benefits, which is why there is no option to select “pre-tax” for these benefits and why they are not listed in the PCP documents. Additional Section 125 documents are necessary for FSAs and dependent care benefits in order to comply with the law, which may be obtained from your benefits professional, attorney or vendor who provided the plan.

However, please note that Wrap360 is currently in the process of creating Section 125-compliant plan documents for health FSAs. Clients will be alerted via email when this feature becomes available.

Finally, because health FSAs are ERISA-covered group health plans, a health FSA would need an SPD, so it would be prudent to include the health FSA in the Wrap SPD and Wrap Plan Document as one of your benefit component plans.