Flexible Spending accounts


N

NLPC

If an employee has requested a yearly FSA of $2000 and in
the first month requests the entire $2000 for valid
expenses, does the employer have any recourse to recoup any
of the money if that employee leaves employment before
year's end?

NLPC
 
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A

Arthur L. Rubin

NLPC said:
If an employee has requested a yearly FSA of $2000 and in
the first month requests the entire $2000 for valid
expenses, does the employer have any recourse to recoup any
of the money if that employee leaves employment before
year's end?
No. On the other hand, if the employee doesn't accure
$2000 in the year, and report them by (usually) March of
the following year, the employer keeps the money.

(Medical FSAs are subject to COBRA, and there may be further
complications if the employee has $2000 in covered charges
accrued while employment was in effect, but not processed
until after employment.)
 
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A

A.G. Kalman

NLPC said:
If an employee has requested a yearly FSA of $2000 and in
the first month requests the entire $2000 for valid
expenses, does the employer have any recourse to recoup any
of the money if that employee leaves employment before
year's end?

NLPC
No recourse. The offset to the employer is any amount that
an employee does not use in the year. It's the employee
"use it or lose it" rule.
 

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