What if I want to make FSA changes mid-year?

If you qualify for a life-changing event — like having a baby or getting married — you can typically make changes to your FSA without penalties or fees. Ultimately, it's up to your individual plan on if you're allowed to make a change (or not) so you'll want to check with your HR department or plan administrator on the details.

Not sure if you should change your coverage mid-year? Read on to see if these circumstances might apply to your situation.

You want to increase your coverage

If you have a traditional FSA, you may be able to increase your coverage for a qualified event. If you welcomed a new child to your family — whether through birth or adoption — you can request to increase your FSA contributions if you feel it'll help you with saving costs on qualified medical expenses.

The change in coverage should be consistent with the event. If you add a dependent through a qualifying event, your administrator may allow you increase your election. If you remove a dependent, you may be allowed to decrease it.

Things are a little different for dependent care FSAs (DCFSAs) and the rules aren't quite as strict. Let's say you want to switch preschools for your daughter. It's closer to work and you like the overall vibe of the place. The tuition increase — $800 per month — has you feeling a bit nervous because you only allotted $600 a month for your DCFSA. You may be able to increase your election because of a change in childcare provider (again something you'll want to talk with your administrator about).

Decreasing your coverage instead?

As we stated earlier, if you make changes mid-year, it needs to match the life event. So if your child is no longer eligible for coverage and ages out of your health plan, you may be able to request that your contributions be lowered instead of increased. Even if you have more qualified medical expenses, you may not be able to put more money into an FSA because that wouldn't be consistent with the qualifying event.

Note that you don't have to change your contributions due to a qualifying event. You may want to keep your contributions as is because they may still work for your situation.

No matter what your dependent situation is, it's a good idea to take stock of your current expenses and your budget and plan the best you're able to for the year. It's also a good idea to make sure in advance that your plan will allow you to make a change if you're planning to mid-year.

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