The COVID-19 pandemic continues to impact workplaces across the country, and employers are looking for ways to support their employees. Below is an explanation of the different accounts that can be created to help provide for your employees during this time. Also below is a link to a comparison chart for each solution.
COVID-19 Solution Comparison Chart
EMERGENCY SPENDING ACCOUNT
This plan is employer-funded and leverages post-tax dollars to help your employees through this challenging time by covering any expenses you choose.
Offer this plan to cover any expenses that have emerged as a result of COVID-19, including (but not limited to):
- Additional daycare needs
- Work-from-home equipment (such as monitors, internet charges, cell phone expenses, etc.)
- Groceries Meal delivery services (UberEats, Grubhub, etc.)
- Meal delivery kits (Blue Apron, HelloFresh, etc.)
*Eligible expenses under this plan can be added or removed at any time. Post-pandemic, this plan can be terminated or converted to a Lifestyle Spending Account and cover wellness-related expenses.
* As with any plan offerings, please consult with your legal counsel, tax adviser and benefits attorney.
DISASTER RELIEF PAYMENTS (SECTION 139)
This plan is employer-funded and leverages tax-free dollars to help your employees during a federally declared disaster. On March 13, 2020, COVID-19 was designated a disaster under the Robert T. Stafford Disaster Relief and Emergency Assistance Act.
Under this plan, dollars are provided to employees and used to reimburse or pay reasonable and necessary personal, family, living or funeral expenses incurred as a result of COVID-19. Offer this plan to cover expenses such as, but not limited to:
- Health-related expenses not considered medical, including over-the-counter medications, hand sanitizer, disinfectant, cleaners, soap
- Child care and/or tutoring expenses due to school closings
- Increased home expenses, such as home office set-up, internet and cell phone charges, printer and related expenses Increased utility expenses
- Transportation expenses due to work relocation
- Critical care and funeral expenses
* As with any plan offerings, please consult with your legal counsel, tax adviser and benefits attorney.
LIFESTYLE SPENDING ACCOUNT
This plan is employer-funded and leverages post-tax dollars to promote the well-being of employees through physical, financial and emotional wellness, especially during these trying times.
Offer this plan to cover expenses such as, but not limited to:
- Athletic equipment and accessories
- Virtual fitness classes
- Home purchase expense reimbursement (down payment, closing costs, etc.)
- Financial Advisor fees
- Virtual meditation classes
- Counseling services
* Eligible expenses under this plan can be added or removed at any time. The examples above are relevant to the current pandemic.
** As with any plan offerings, please consult with your legal counsel, tax adviser and benefits attorney.
