With the end of the year quickly approaching, we want to provide an update regarding pandemic-related relief provisions for flexible spending accounts (FSA) and dependent care accounts (DCA).
Several pieces of legislation were signed into law over the past 18 months to help American families manage healthcare costs during the pandemic. This temporarily included:
- Raising the annual dependent care FSA contribution limit to $10,500
- Allowing participants to roll over all unused FSA funds to the following plan year
- Extending the FSA grace period from 2 ½ months to 12 months
These provisions are set to expire at the end of the year and will not be applicable to the 2022 plan year.
Important Note Regarding FSA Rollovers:
Employers cannot include a provision in their 2022 plan to allow all unused FSA funds to rollover to the plan year that ends in 2023. However, employers can still allow all unused funds to rollover from the 2021 plan year to the 2022 plan year.
Ameriflex clients who have questions regarding these upcoming changes can reach out to their Client Relationship Team for assistance.