Business groups and employer advocates applauded after the IRS issued notice on Thursday that up to $500 in Flexible Spending Accounts can be carried over, starting with the period from 2013 to 2014. On December 31 of this year, use-it-or-lose-it will only apply to dollars 501 and above.
If open enrollment materials have already been finalized for 2014, it’s too late to communicate the change for 2013 funds. The $500, however, does not lower the annual $2,500 FSA limit, so up to $3,000 may be available in the following plan year. The old two-and-a-half-month grace period still applies.
