How do I Identify Key and Highly Compensated Employees?

Like other tax-free accounts under IRS Sections 105 and 125, FSAs  are subject to non-discrimination testing to determine whether the plan is compliant with IRS guidelines and that all your employees receive the same level of benefit from their FSAs.

Which of my employees are highly compensated for compliance testing purposes?

Generally speaking, employees who own more than 5% of your company or make over $125,000 a year are considered highly-compensated for compliance testing purposes. 

Which of my employees are key employees for compliance testing purposes?

Generally speaking, key employees are officers (CEO, COO, President) who make over $180,000 a year, employees (and family members) who own 5% or more of your company, and employees who own over 1% of your company and make over $150,000 a year.