Capitol Benefits Group News & Updates
As we reflect on the past year, we want to take a moment to express our sincere appreciation for your trust in Capitol Benefits Group.
Protecting the people that matter most to you, including yourself, is a responsibility we value deeply, and we are truly grateful for the opportunity to serve as your insurance partner.
Your confidence in our agency motivates us to continually deliver the highest level of service, guidance, and support. Whether we’re helping you review your coverage, navigating a claim, or simply answering questions, our commitment is to ensure you feel informed, protected, and valued every step of the way.
We are not acquainted with the benefits legend who decided that January 1st is the universal ‘‘Yup, that’s the day we stress everyone out about their insurance and benefits all at once on the same date.” As you may know, about 60% of all U.S. companies renew their employee benefits and conduct open enrollment activities at year-end. The Marketplace and Medicare open enrollment seasons also occur during this time of year. These programs also renew on the calendar year annually
In all seriousness however, we pause this week for a moment of gratitude for meaningful work and the wonderful clients we are blessed to represent especially in times of volatility and change in the healthcare benefits industry.
We thank you for your patience and understanding throughout this exceptionally busy time of year. We’re always working diligently behind the scenes conducting required open enrollment activities. Our goal is to respond to our clients as quickly as possible and simultaneously deliver a quality experience with plan reviews and annual recommendations.
Outside of annual open enrollment, please know that we’re always here for you! If you experience any changes in your life, have concerns about your coverage, or would like a comprehensive policy review or re-review of coverage, we welcome that opportunity. Your peace of mind is our priority and engaged clients make our professional hearts happy!
Additionally, you are invited to request a meeting with Tracy or Marcie to provide feedback on your client experience working with our team. You can request a meeting or provide written feedback HERE.
Thank you again for your loyalty and trust. We look forward to continuing to serve you for many years to come.
Benefits Bulletin: Fringe and Account-Based Benefits Plan Updates for 2026
Provisions from the budget reconciliation bill (HR 1: One Big Beautiful Bill Act), affecting benefits provisions in 2026, are described below.
Tax-free reimbursements to employees for qualified commuting expenses for bicycles, previously excluded for tax years 2018 through 2025, is indefinitely excluded. As a result, employers can’t reinstate bicycle commuter expenses as a tax-free benefit again in 2026 and need to amend their fringe benefits documents if they included the previous temporary exclusion dates.
The dependent care flexible sending account (DCFSA) annual contribution limit will increase to $7,500 for plan years beginning in 2026.
Increasing the limit is optional for employers; however, employers offering a DCFSA that want to take advantage of the increase should update their cafeteria and benefits plan documents and notify employees prior to the start of their 2026 plan year.
Beginning January 1, 2026, certain direct primary care service arrangements (a contract between an individual and primary care physicians for care for a monthly fee) will not prohibit an employee from contributing to a health savings account (HSA). Employees may use their HSA to pay the monthly cost of direct primary care service arrangements that meet certain qualifications (e.g., a monthly fee of $150 or less for one person).
HR 1 was signed by the President on July 4, 2025.
Federal: IRS Publishes 2026 Annual Benefits Maximums
The IRS published the 2026 limits for several types of benefits that have maximums subject to annual change. You can find the full list of the new amounts in the IRS Revenue Procedure 2025-32.
The most asked-about-limits and thresholds are noted below and they apply to taxable years starting in 2026:
Health Savings Accounts (HSAs)
Self-coverage only: $4,400 ($100 increase from 2025)
Family coverage: $8,750 ($200 increase from 2025)
Annual catch-up contribution maximum remains unchanged at $1,000 for HSA-eligible individuals age 55 or older
Health Flexible Spending Accounts (HFSAs)
The HFSA contribution limit is $3,400. For HFSAs that include a carryover feature, the maximum carryover is $680.Dependent Care Flexible Spending Accounts (DCAPs)
The DCAP contribution limit is $7,500 ($2,500 increase from 2025).
Qualified Small Employer Health Reimbursement Arrangement (QSEHRA)
The maximum total for all QSEHRA reimbursement and payments is $6,450 for single coverage and $13,100 for family coverage.
Adoption Assistance Programs
The maximum employee tax credit and amount an employer can provide for adoption assistance is $17,670. The tax credit begins to phase out for individuals with a modified adjusted gross income above $265,080 and is completely phased out at $305,080 and above.
Qualified Commuter Plans—Mass Transit and Parking
The monthly limit for both qualified parking and mass transit is $340.
Federal: IRS Raises ACA Affordability Threshold for 2026 Plan Year
The Affordable Care Act (ACA) affordability threshold will increase to 9.96% for plan years beginning in 2026.
This threshold, applicable to large employers subject to the ACA’s “play or pay” provision, is the maximum percentage of an employee’s W-2 wages or rate of pay, or the federal poverty line, that they can be asked to contribute toward their employee-only health insurance coverage.
You can learn more about employer responsibilities under the ACA on the IRS’s Q&A page and in our Understanding Affordability and Safe Harbors guide.
The IRS released Revenue Procedure 2025-25 on July 18, 2025.