Most Florida small businesses default to a calendar-year health insurance plan year (January 1 to December 31) without much thought, but the ERISA plan year is actually a separate election from the business's tax year. Choosing a non-calendar plan year can match the renewal timing to the business's slow season, align with carrier rate cycles, or stagger nondiscrimination testing dates. The choice has consequences for Form 5500 filing, Section 125 election timing, and HSA contribution proration.
A health plan year is the 12-month period defined in the plan document. A business's tax year is the period covered by its annual tax return (typically calendar year for most pass-throughs). They do not have to match. A Florida S-corp on a calendar tax year can run a July-to-June health plan year and still file Form 1120-S for the calendar year.
Sorting out your benefits obligations
| Plan Year | Best For | Considerations |
|---|---|---|
| January – December | Aligns with calendar / payroll / W-2 | Open enrollment competes with Q4 holidays |
| July – June | Mid-year renewal; carrier rate availability | Section 125 election period mid-year |
| October – September | Timing around fiscal year-end | Q4 open enrollment overlaps health plan setup |
| April – March | Tax-season buffer for owners | Renewal in slow season for many businesses |
Health and welfare plans with 100+ participants at the start of the plan year must file Form 5500. The form is due 7 months after plan year end (so a calendar-year plan files by July 31 of the following year). Most Florida small businesses are below 100 participants and exempt from Form 5500 (small plan exception).
If a business changes its plan year (creating a "short plan year"), the short plan year requires its own Form 5500 if the participant count threshold is met.
Section 125 elections must align with the plan year, not the tax year. A non-calendar plan year means employees make annual benefit elections at non-calendar timing. The plan year also dictates when Health FSA carryover or grace period clocks reset.
HSA contribution limits are tied to the calendar year regardless of the underlying HDHP plan year. An employee on a July-to-June HDHP plan year still has the calendar-year HSA limit ($4,400 self / $8,750 family for 2026). The limit pro-rates if the employee was HSA-eligible only part of the year.
When a business changes from one plan year to another, a short plan year (less than 12 months) bridges the gap. Considerations:
A licensed Florida broker can advise on plan-year selection during your initial setup or renewal.
Get a Consultation