WSR 01-11-053

PERMANENT RULES

DEPARTMENT OF

RETIREMENT SYSTEMS

[ Filed May 10, 2001, 4:29 p.m. ]

Date of Adoption: May 10, 2001.

Purpose: On February 1, 2001, Department of Retirement Systems (DRS) adopted an emergency change to WAC 415-630-030 to comply with a change in Internal Revenue Service (IRS) Tax Code. This change provides more flexibility to the Dependent Care Assistance Salary Reduction Plan (DCAP) program. In the permanent rule, besides complying with the IRS code, DRS has broken the rule into two rules and made several other changes in an attempt to make the provisions more clear and easier to understand.

Citation of Existing Rules Affected by this Order: Amending WAC 415-630-030.

Statutory Authority for Adoption: RCW 41.50.050(5).

Other Authority: RCW 41.04.600-41.04.645, U.S.C. 125, 26 C.F.R. Part 1 (Tax Treatment of Cafeteria Plans).

Adopted under notice filed as WSR 01-08-076 on April 3, 2001.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 1, Amended 1, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 1, Amended 0, Repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 1, Amended 1, Repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.

Other Findings Required by Other Provisions of Law as Precondition to Adoption or Effectiveness of Rule: The emergency rule currently in effect expires approximately May 31, 2001. The permanent rule makes no substantive changes, as compared with the emergency rule. Adoption of the permanent rule prior to the expiration of thirty-one days is necessary to ensure that the DRS DCAP program continues to comply with IRS code.Effective Date of Rule: May 15, 2001.

May 10, 2001

John Charles

Director

OTS-4724.2


NEW SECTION
WAC 415-630-025   May I change or revoke the terms of my salary reduction agreement (SRA) during the plan year?   The SRA is irrevocable during the plan year unless you have a qualifying change in status as defined in WAC 415-630-030. If you have experienced a qualifying change in status and need to change or revoke your SRA, you must fill out a new SRA form and submit it to the department. Such changes require approval by the department. An explanation of the requested change may be required.

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AMENDATORY SECTION(Amending WSR 96-16-020, filed 7/29/96, effective 7/29/96)

WAC 415-630-030   What constitutes a qualifying change((s)) in ((family)) status((.))?   ((A participant is permitted to revoke a salary reduction agreement after the period of coverage has commenced and to enter a new salary reduction agreement regarding the remainder of the plan year if both the revocation and new election are on account of and consistent with any of the following changes in family status:)) The following are qualifying changes in status for purposes of DCAP:

     (1) Marriage;

     (2) Divorce or legal separation;

     (3) Death of a spouse or dependent;

     (4) Addition of a dependent to the eligible employee's household, such as the birth or adoption of a child ((or addition of a dependent to the eligible employee's household));

     (5) Termination of spouse's employment ((of a spouse));

     (6) Employment of an unemployed spouse; and

     (7) A change in the ((eligible employee's or eligible employee's spouse's working hours which significantly alters the need for dependent care; example: A shift from full time to part time, part time to full time, or a change to or from leave without pay status.

     (8) Such other events that the department determines will permit a change or revocation of an election during a plan year under regulations and rulings of the Internal Revenue Service.

     An eligible employee may also become a participant in the plan on the basis of a change in family status)) work hours of the eligible employee or spouse that alters the need for dependent care.

     (8) A change in dependent care provider;

     (9) A change in dependent care provider cost; or

     (10) No longer use dependent care services.

[Statutory Authority: RCW 41.50.050 and 41.50.780(11). 96-16-020, § 415-630-030, filed 7/29/96, effective 7/29/96.]

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