reimburse as you go

[Guest wingnut]

Can you only remiburse the amount only for which has been deposited via payroll deductions? Or do have to reimburse the total amount even though it is less than the particpant has had deducted and then have the participant pay back that amount through future deductions?:confused:

[papogi]

Health Care FSA's operate under the Uniform Reimbursement Requirement, whereby the entire annual election must be made available at any point within the plan year. If the employee elects $1000 on 1/1 and submits an eligible claim for the entire amount later that same month, you've got to send out the entire $1000. This is the employer's risk in offering the benefit. Conversely, any unused amounts leftover in employees' accounts at the end of the year are forfeited to the employer. This is the risk the employee takes.

Dependent Care FSA's do not have this basic requirement. Employees are only eligible for the amount actually deducted so far year to date. End of plan year forfeiture rules still apply, however.