The Treasury Department and Internal Revenue Service will allow Flexible Spending Account holders to carry over as much as $500 from one year to the next without a penalty.
Los Angeles Times: IRS Eases Rules On Healthcare Flexible Spending Accounts
Workers faced with forfeiting unused money in their flexible spending accounts for healthcare expenses may be getting some relief under a new federal rule. The U.S. Treasury Department and Internal Revenue Service changed the use-it-or-lose-it rule for flexible spending arrangements, or FSAs, to allow account holders to carry over as much as $500 from one year to the next without penalty (Terhune, 10/31).
The Wall Street Journal: Consumers Can Roll Over $500 In An FSA
The Obama administration loosened rules governing health-care savings accounts known as flexible-spending arrangements, or FSAs, allowing consumers to roll over as much as $500 in unused funds each year. The change—likely to be popular with consumers—modifies the use-it-or-lose-it rule that has governed the tax-advantaged accounts for decades (McKinnon, 10/31).