It depends on the type of Health Care FSA/Limited Purpose FSA program your employer has in place. There are four scenarios for unused money left in your account at the end of the plan year:
- If your employer offers a carryover, up to a certain amount will automatically transfer to the next plan year. The amount that will carry over is up to your employer, but the IRS sets a maximum amount that can change every year.
Note: An employer can’t have both a grace period and a carryover. - If your employer offers a grace period, you have up to 2.5 months after the end of the previous plan year to use unspent money on eligible medical expenses during the current plan year (for example, you could use 2023 money on a doctor’s visit in 2024.)
Note: An employer can’t have both a grace period and a carryover. - If your employer offers a run-out period, you have a specified amount of time after the end of the previous plan year to file claims for expenses incurred in the previous plan year (for example, you could file a claim in 2024 to use 2023 money on a doctor’s visit in 2023.)
- If you have a standard FSA, you lose any unspent money at the end of the plan year.
Reach out to your HR team for more information on your specific FSA plan.