Using Flex Benefit Periods
A flex benefit period is a period of time for which a particular combination of an employee's flex benefits are in effect during a flex plan year. The Benefits Administration application uses flex benefit periods to determine how many flex and pretax dollars an employee has available and has spent on any date in a flex year.
Initially, the Benefits Administration application creates one flex benefit period for the entire flex plan year. Each time you add or stop benefits in a flex plan year, the Benefits Administration application updates or creates another flex benefit period.
For example, Dorothy receives $1,000 flex credits for the flex plan year. The Benefits Administration application creates one flex benefit period for the entire flex plan year and one standard time record for the amount of $19.23 ($1,000/52).
Dorothy enrolls in the following benefits from January 1 to December 31.
| Benefit | Cost |
|---|---|
| Dental | $100 |
| Employee Life | 75 |
| Health | 500 |
| Total | $675 |
Dorothy spends some of her flex credits, so the Benefits Administration application reduces her standard time record to $6.25 ($325/52).
On April 1, Dorothy changes her benefit elections. ABC Foods stops her existing benefits on March 31. The Benefits Administration application stops the first flex benefit period and the associated standard time record on March 31. The Benefits Administration application creates a second flex benefit period and standard time record for April 1 through December 31. The amount of the standard time record is $19.23 ($1,000/52) because Dorothy has not spent any flex credits during the second flex benefit period.
ABC Foods adds the following benefits for Dorothy beginning April 1.
| Benefit | Cost |
|---|---|
| Health | $1,000 |
| Dental | 100 |
| Employee Life/AD&D | 75 |
| Disability | 100 |
| Total | $1,275 |
Dorothy spends all her flex credits for the second flex benefit period, so the Benefits Administration application deletes the standard time record associated with the second flex benefit period.
On September 30, Dorothy stops her benefits for the rest of the flex plan year. The Benefits Administration application stops the second flex benefit period. The Benefits Administration application creates a third flex benefit period and standard time record for October 1 through December 31. The amount of the standard time record is $19.23 ($1,000/52) because Dorothy has not spent any flex credits during the third flex benefit period.
By looking at Dorothy's flex benefit periods, you can see that she had three different combinations of benefit elections in this flex plan year. During the first period, she received part of her flex credits as taxable income. During the second period, she spent all her flex credits. During the third period, she received all her flex credits as taxable income.