The Internal Revenue Service has announced a new provision that allows enrollees in health care flexible spending accounts (FSA) to carry over up to $500 of unused funds into the next plan year. Iowa State's flexible spending plan, administrated by ASIFlex, will implement the new carry-over provision beginning with the current fund year.
Some of the benefits of this change include:
- Minimal risk of losing unused funds at the end of the plan year
- No more precise calculations of out-of-pocket expenses
- No more last-minute purchases to deplete the remaining fund balance
A few things to remember
The carry-over amount will not reduce your election amount. Instead, the carry-over amount will be added to your original election. For example, if you normally set aside $400 each year in your FSA and your 2013 claims total $200, then the amount of available funds for 2014 would be $600.
The carry-over balance will be determined at the end of the plan’s run-out period, which is April 30, 2014, for ISU enrollees. The run-out is the period of time during which you can submit claims from the previous year. The remaining balance, up to $500, will be automatically added to your 2014 plan year balance.
If you have questions about the new carry-over provision or you would like to enroll in an FSA, contact university human resources at 4-4800.