Is Your FSA Grace Period Deadline Soon?

Do you have a Flexible Spending Account (FSA) that expired on December 31, 2023? If you haven’t depleted all the funds in your 2023 FSA, or filed claims for health-related expenses from 2023, you’ll want to make sure to review your options and deadlines as soon as possible.

Normally, for an FSA plan ending December 31, any unspent funds in your account would be forfeited back to your employer. But if your company offers a grace period, you have until March 15, 2024 to spend any remaining 2023 dollars. Check with your employer to find out what your plan extension options are.

If you do have a balance to spend — and a 2.5-month grace period to do it in — you should know that there are a wide range of items that qualify for purchase with your FSA. In addition to staples like contact lenses and lens solution, and over-the-counter meds, like pain and allergy relief, there are hundreds of products & services that you might be surprised are FSA eligible. Many high-tech items, including smartphone-enabled blood pressure monitors, electrotherapy & other pain relief devices, smart baby monitors, and more are eligible for purchase with pre-tax FSA dollars. You can find a complete list of FSA eligible items here.

What is the FSA spending deadline?

All FSA plans have different deadlines, depending on the employer. Generally, you must spend the money in your FSA within your plan year, but your employer may offer one of two options:

A "grace period" of up to 2.5 extra months to use your FSA money.
A carryover, or rollover, of up to $610 from your 2023 FSA to use in 2024.

Your employer doesn’t have to offer these options. If it does, it can be either one of these options, but not both, so be sure to check with your organization.

What is the FSA deadline to submit claims?

The deadline to submit claims is usually the last day of the plan year, but your employer can extend it. This so-called “run-out” period — often lasting about 90 days — gives you extra time to submit expenses you incurred in the last plan year. This timeframe is chosen by your employer, not the IRS, and varies from employer to employer. You should check with your organization on this deadline as well.

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