Healthcare

Contact: Ken Mason; Spencer Fane Britt & Browne LLP (Missouri, USA)

Recent IRS guidance creates a new exception to the "use-it-or-lose-it rule" that has long discouraged employees from contributing to a health flexible spending account ("health FSA"). Sponsors of health FSAs may now allow employees to carry over up to $500 of their account balance from one plan year to the next, thereby reducing their risk of incurring a forfeiture. This "carryover" option is immediately available (even for 2013), but sponsors wishing to implement the option for either 2013 or 2014 will need to act quickly.

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