December 17, 2013
With the end of the year on the horizon, many individuals with flexible spending accounts (FSAs) are scurrying to spend residual funds to avoid “losing” them, in accordance with IRS regulations. However, the regulations have now changed with the IRS easing the “use-it-or-lose-it” rule for health flexible spending plans. Individuals with FSAs can now carry over a maximum of $500 to the following year without forfeiture. So now, employees will not have to rush to clean out their accounts by the end of the year, or by March 15 of the following year, if their flexible spending plan has adopted this grace period.
It is important to note that an employer cannot offer a FSA carryover provision and an FSA grace period at the same time. In order to allow for this $500 carry over, employers must amend their plans to adopt the change. However, if an employer’s FSA plan currently allows for the grace period, that provision must be dropped in order to allow for the $500 carryover adoption.
Employers can implement the carryover for 2013 as long as the flexible spending plan is amended by the end of 2014. However, if the plan currently allows the grace period up until March 15, then the plan must be amended by the end of 2013 to formally eliminate this provision.
If you have any questions about this information, please contact us. We are always here to help.
Prior to moving to Madison, the last bike I owned was a Nashville Predators themed bike I won at the age of 9, so it had been a while since I found myself in the saddle. Upon my arrival here, I discovered the city’s rich biking culture as well as its system of paths and knew I had to take advantage of all it had to offer. After a couple of years of riding and exploring, I feel like I know my way around town on a bike pretty decently.
Do online reviews help or hurt a business? Depending on the type of review, of course, it could go either way.
The IRS has provided guidance to employers regarding the recent presidential action to allow employers to defer the withholding, deposit and payment of certain payroll tax obligations. The three-page guidance in Notice 2020-65 was issued to implement President Trump’s executive memorandum signed on August 8. Private employers still have questions and concerns about whether, and how, to implement the optional deferral.