What happens to contributions left in my FSA at the end of the year because I didn file claims against them?
Because of the favorable tax treatment provided by the FSA, government regulations require that the money you contribute to your FSA only be used for eligible expenses incurred during that same year. However, you may submit claims for a given year up to your plan’s claims filing deadline (such as March 31) in the following year. Any money left in your account(s) after the claims filing deadline is forfeited. You cannot use one year’s contributions for the next year’s expenses. Here’s an example. Joseph enrolls for an FSA and elects to set aside $500 a year. By the claims filing deadline of the following year, he has only filed claims for $450. He forfeits the $50 difference. Joseph does not, however, lose the tax savings on that $50.
Related Questions
- What happens to any unused contribution? Why can the participants get a refund of their unused contributions at the end of the Plan Year?
- What happens to contributions left in my FSA at the end of the year because I didn file claims against them?
- What happens if there is money left in the FSA at the end of the year?
