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A qualifying life event is a change in an employee's personal circumstances, such as marriage, birth, divorce, or loss of other coverage, that permits a mid-year change to benefit elections outside of open enrollment under a Section 125 cafeteria plan.
Cafeteria plan elections are generally irrevocable for the plan year. IRS Publication 15-B describes the exception for specific change-in-status events, and the plan document controls which ones it recognizes. Typical qualifying life events include marriage, divorce or legal separation, birth, adoption, or placement for adoption, death of a spouse or dependent, a dependent gaining or losing eligibility, a change in the employee's or spouse's employment status affecting eligibility, and loss of other group or government coverage.
Two rules govern what the employee may do. The change must be consistent with the event, so a new baby supports adding dependent coverage but not dropping dental. And the employee must request the change within the plan's notification window, commonly 30 days, or 60 days for events tied to Medicaid and CHIP eligibility changes. Coverage effective dates and retroactivity follow the plan document and the carrier's rules.
The practical burden is administrative. Employers should require reasonable documentation such as a marriage certificate or a loss-of-coverage letter, log the request date, and process the payroll deduction change in the same cycle as the carrier change, which usually moves on an 834 enrollment file, so deductions do not drift out of sync with coverage. Missing the window is the most frequent problem, and the plan generally cannot make an exception without risking its tax status.
Marriage, divorce or legal separation, birth, adoption or placement for adoption, death of a spouse or dependent, a dependent gaining or losing eligibility, a change in employment status affecting eligibility, and loss of other group or government coverage. The plan document controls which events it actually recognizes.
Yes. The consistency rule requires the election change to correspond to the event, so the birth of a child supports adding dependent coverage but does not support dropping dental. Plan administrators apply that test before processing anything, which is why documentation of the event matters.
The election generally stands until the next open enrollment. Cafeteria plan elections are irrevocable for the plan year outside a permitted change, and the plan cannot simply make an exception without putting its tax treatment at risk. Log the request date so the window can be proven.