What if you use up your annual contribution to your Flexible Spending Account?

Question

I'm trying to decide whether to enroll in FSA through my new employer. I understand the "use it or lose it" rule. But what happens if the opposite occurs?

Answer 1

The simple answer is that you will have to pay for qualifying medical expenses out of your other accounts. Funding your FSA is a guessing game. The best you can do is look at your previous years' medical expenses and try to put an amount in there that would cover what your insurance didn't pay.

One thing to remember is that you can use funds from your FSA up until April 15 of the following year. Buy some new eyeglasses or have your appendix removed if you've been putting it off (just kidding).

Answer 2

If you use up the amount that you have decided to contribute for the year; you've used it. You must wait until the next plan year to take advantage of the FSA spending again.

Basically, you could use up the monies that you set aside in the first month and your payroll contributions would still be taken out on a set deduction amount until the end of the plan year.

Answer 3

once you use it all up then that is it you used it and have no more currency available to you through that account