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How do the 2020 plan year rule amendments affect the dependent age limit for Dependent Care FSAs?

Recent IRS guidance permits employers to temporarily increase the maximum age limit for qualified dependents covered under a Dependent Care FSA by one year. This specifically pertains to employees that enrolled in a 2020 Dependent Care FSA by January 31, 2020. The State of Michigan has adopted this change. Therefore, eligible employees may use any remaining funds in their 2020 Dependent Care FSA for qualifying expenses incurred for their dependent who turned age 13 during plan year 2020 up until that dependent turns age 14. Prior to this change, qualifying dependents could be covered under a Dependent Care FSA through age 12, until their 13th birthday.