Section 125

General Information

Plan Administrator: P&A Group
Informational Video: What is Section 125?

Section 125 of the Internal Revenue Code allows for the establishment of individual non-taxable accounts to pay for expenses associated with certain types of health and dependent care expenses.

This benefit offers employees the opportunity to have money deducted from payroll on a pre-tax basis for reimbursement of eligible medical, dental, vision, and/or daycare expenses.

Participation in a Health Flexible Spending Account and/or Dependent Care Flexible Spending Account is optional and available for benefits-eligible classified, management, management confidential, faculty and part-time faculty employees. Enrollment in Section 125 is offered on a calendar year basis for qualified health care and dependent care expenses incurred between January and December each plan year. Employees must re-enroll each plan year to participate in Section 125. Human Resources will facilitate an open enrollment process for Section 125 each year, typically in November.

A new enrollment process must be completed each calendar an employee wishes to participate in the plan. Enrollment does not roll over from one year to the next.

The election(s) made for Section 125 cannot be changed during the year except in the following circumstances: change in family status (marriage, divorce, death, birth or adoption); and/or change in FTE or employment status of employee or spouse. If one of these exceptions occur, please contact Human Resources within 60 days.

It is an IRS "use it or lose it" program, so unused dollars are not refunded to the employee.

Health FSA

Expenses incurred by the employee, spouse or IRS dependent children that are not covered under a medical, dental or vision plan. Examples: office co-pay, co-insurance and deductible.

Upon election of the Health FSA, eligible expenses can be paid using the P&A Benefits Card or reimbursed by submitting a claim reimbursement request.

Resource Center for Health FSA Participants

Limited Purpose Health (D/V) FSA

Employees who are enrolled in the High Deductible Health Plan (Moda Medical Plan 6) and the corresponding Health Savings Account are eligible to contribute to a Limited Purpose Health FSA. By enrolling in a Limited Purpose FSA, pre-tax dollars can be used to pay for eligible expenses now, saving the HSA contributions for retirement.

Expenses reimbursed through a Limited Purpose Health FSA are restricted to dental and vision expenses only.

Upon election of the Limited Purpose Health FSA, eligible expenses can be paid using the P&A Benefits Card or reimbursed by submitting a claim reimbursement request.

Resource Center for Limited Purpose Health FSA Participants

Dependent Care (Daycare) FSA

Expenses incurred for childcare or elder care that enable the employee to work. Examples: daycare, summer day camps, after school care and senior care.

Eligible dependent and/or senior care expenses can be paid using the P&A Benefits Card or reimbursed by submitting a claim reimbursement request.

Resource Center for Dependent Care Participants

Medical Insurance Premium

The portion of the group health insurance premiums not paid by the employer (i.e. employee portion of the premium that is deducted from the employee’s paycheck). Exception: The IRS will charge taxes on the portion of the total premium that is used to pay for a domestic partner and a domestic partner’s dependent children’s coverage.

Annual Minimum and Maximum Contribution Amounts

2025

Health and Limited Purpose Health FSA - $240 minimum and $3300 maximum

Dependent Care (daycare and senior care) FSA – no minimum and $5000 maximum if single or married filing jointly; $2500 maximum if married and filing separately.

College Contribution

In addition to the employee contribution to a Healthcare FSA, the College also makes a contribution. Employer maximum contribution levels* are based on medical insurance enrollment tiers as follows:

The College contribution does not apply toward the IRS maximum. Employees can contribute up to the annual maximum and receive the employer contribution in addition. There is no College contribution to Dependent Care or Limited Purpose Health FSAs.

*Based on IRS rules and regulations, an employer contribution exceeding $500 requires an employee contribution equal to or greater than the employer contribution. For those employees whose LCC contribution would normally exceed $500, LCC can only “match” the employee contribution for amounts above $500, still subject to the regular maximum College contribution.

See below for more information.

Account Access

For online access to your 2024 Section 125 account, log on to the P&A Participant Portal.

Expense Reimbursement

Claim forms are available inside your My Benefits account and reimbursements requests can be submitted using any of the following methods:

• Online: P&A Participant Portal
• P&A Mobile App
• Mail: 6400 Main St, Suite 210, Williamsville, NY 14221
• Fax: (877) 855-7105

Reimbursements will be made by check or direct deposit.

All claims for reimbursement from the previous calendar year’s balance must be submitted by March 30 of the current calendar year. For example: If you have a 2024 expense to be reimbursed, the claim for reimbursement must be submitted no later than March 30, 2025. This is an IRS rule; therefore, there are no exceptions.

Grace Period

If an employee has unused funds from the previous calendar year, expenses incurred through March 15 of the following calendar are still eligible to be reimbursed out of the previous calendar year’s balance. For example: If you have unused funds in 2024, expenses incurred through March 15, 2025 can be reimbursed from the 2024 balance.