Q.- An employee is going on maternity leave. May she continue to submit expenses for reimbursement from her FSAs while she is on leave?
A.- The answer depends in part on what FSA and in part on the employer’s plan rules and procedures.
1. Dependent Day Care FSA. A dependent day care FSA may be used only for the participant to work or look for work, and the expense must be necessary to allow the participant to work. There is an exception to this rule for short, temporary absences. If the participant is home on maternity leave, she is not at work and will not be able to be reimbursed for dependent day care expenses incurred while she is on leave, even if she continues to pay for child care during her absence.
2. Health Care FSA. This is where the plan's rules and the employer's procedures come into play. If the maternity leave is FMLA leave, the employee must be given the opportunity to continue health FSA participation during the leave. A few different options are available for recouping payment during the leave. If the employee chooses to participate in the health FSA during the leave and if the employee pays for participation during the leave, expenses incurred during the leave may be eligible for reimbursement.