Title: IN3 Section 125 Plan Document

Recommendation:

I recommend the School Board adopt the revised Plan Document, effective January 1, 2006, for the District's flexible spending accounts, which falls within the requirements of Section 125 of the Internal Revenue Code.

Description:

• The School Board initially established these plans in 1995 and revised in 2000 and 2004.  These plans provide significant tax savings to employees and the District.

•This plan document is updated to comply with revised IRS guidelines, which allow a 2-1/2 month grace period following the end of the plan year during which amounts unused as of the end of the plan year may be used to reimburse Eligible Medical and/or Dependent Care Expenses incurred during the plan year.  Basically this allows employees more time to use funds before they risk losing it.  Two and a half months is the maximum grace period allowed by the Internal Revenue Service (IRS).

• The plan document was written by Fringe Benefits Management Company and thoroughly reviewed by the District's benefits consultant, Edify LLC.

•The original Plan Document is available in the Board Minutes office for review.

Financial Impact:
There is no financial impact to the District.

For Additional Information, contact:
Joseph M. Moore (moorej@palmbeach.k12.fl.us)/ Dianne L. Howard