FSAs operate under a “use it or lose it” rule, meaning you risk losing any money left in the account at the end of the plan year. However, employers may offer one of two options to help reduce that risk:
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A grace period of up to 2.5 months to use leftover funds, or
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A carryover of up to a set amount (e.g. $640 in 2024) to the next plan year
Employers can offer one of these options—but not both—and some don’t offer either. Be sure to check your plan’s rules so you don’t leave money on the table.