Announcement–$500Rollover Now Allowed for Health FSA

Great news for your FSA! The IRS recently announced that employers maynow allow a rollover up to $500of unused Health Flexible Spending Account (FSA) funds to the next plan year for employees to use on eligible expenses.

It is optional for employers to offer this rollover, but because this is such an important enhancement to your FSA benefit, we have chosen to make this change. Therefore, any unused funds from your [2015]FSA– up to $500 - will automatically be rolled over for use in the [2016] plan year.

How it Works: You do not have to do anything to opt into the rollover feature. Any unused health funds for your [2015] plan year account – up to $500– will automatically be rolled over for use in the [2016] plan year. Even if you do not make a new election for the [2016] plan year health FSA, you are still eligible to use your carried over funds in [2016].

Frequently Asked Questions

  • [remove if no grace previously offered]How does the rollover impact our grace period? The rollover will replace the grace period for the Health FSA, giving you an entire year to use your funds instead of the 2.5 months allowed by grace.
  • How will the rollover affect contribution limits? Carried over amounts do not count toward your contribution limit. In other words, you may still contribute up to $2,550 a year whether or not you have rolled over funds from the previous year.Your employer may have additional contribution limits. Please see your plan documents.
  • If I do not use all of my rolled over funds within a year, will those unused funds rollover again to the next year?Yes, up to $500 can rollover each year – even funds from a previous year.
  • If I choose not to elect an FSA in the new plan year, will my unused FSA funds still rollover?Yes, even if you do not choose to contribute to an FSA in the new plan year, up to $500 can rollover from the previous plan year.
  • Am I able to rollover unused Dependent Care FSA funds?No. Per IRS regulations, the rollover feature is limited to Health FSAs; Dependent Care FSA funds may not be rolled over.

We are happy to bring you this new rollover feature as just another way we make it easier for you to get the most out of your account!

FSA Rollover Announcement and FAQs09/16/2018Page |1