The end of the 2023 plan year is fast approaching, along with the deadline to spend any funds left in your health Flexible Spending Account. Review your account balance now to avoid forfeiting unused funds and sacrificing potential reimbursement for qualifying out-of-pocket medical expenses.
Flexible Spending Accounts (FSAs), also referred to as Flexible Spending Arrangements, are employer-established benefit plans that allow employees to pay for eligible medical expenses not covered by a health insurance plan with tax-free dollars.
These voluntary plans are generally “use-it-or-lose-it,” which means that any amount in the account at the end of the plan year cannot be carried over into the next plan year and will be lost once the deadline passes. However, your employer may offer one of these two options that allow you more time to spend your FSA funds or to carry over a set amount:
Your employer doesn’t have to offer these options. If it does, it can be either one of these options, but not both.
Contact your plan administrator for specifics regarding your company’s FSA and any questions about a grace period of carry over amount.
Qualifying medical expenses may be incurred by you, your spouse, your child under age 27, or your tax dependent for the purposes of health coverage. Specific qualifying health expenses include:
IRS Publication 502 offers a complete list of FSA-qualified expenses.
Check with your FSA administrator for information on your specific plan expiration dates, limits, and terms.