Question of the Week

Posted by BAS - 05 May, 2022

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Q.- We have an employee who is participating in the Dependent Care FSA. He made a $5,000 election for the year. His child turns 13 on June 15, 2022 and he wants to increase his salary reductions to make the full $5,000 contribution by June 15. Is this allowed?

A.- No. Contributions to flexible spending account plans are made pro-rata throughout the year. If you allow him to contribute, and be reimbursed, the entire $5,000 by June, your calendar year plan will not be following the rules that expenses may be reimbursed only through the dependent’s 13th birthday. If the plan documents allow, the participant could be permitted to stop contributions to the dependent care FSA when the dependent’s expenses are no longer eligible for reimbursement.

Topics: Dependent Day Care FSA, Healthcare FSA, Flexible Spending Accounts, HR & Benefits News


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