If you have a Flexible Spending Account, then you know what a lifesaver it can be. Be aware that Flexible Spending Accounts are going through a few changes next year.
Contributions have risen. The first bit of good news is that the IRS recently increased FSA contribution limits. The limit was raised from $2,500 to $2,550.
Rollovers are allowed. Another updated rule is that account holders are allowed to roll over up to $500 of unspent money into the following year. Before, FSA participants were required to adhere to a “use it or lose itâ€ policy.
In light of the change, make sure to review your FSA balance and check to see if you have any leftovers you can use in 2015. Different companies may have different deadlines for when you can use your money, so find out your specific deadline.
One thing that isn’t changing is the annual limit for dependent care FSAs or dependent care assistance plans (DCAPs). The limit will remain $5,000 for qualifying individuals and those who are married and filing jointly. The limit will remain $2,500 for those who are married and filing separately.
For more information, visit HealthCare.gov and see the article, Using a Flexible Spending Account.