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An employee is going to have taxable income amounts returned to him that he had with-held pretax due to the employer not meeting the non-discrimination testing for their flexible spending account. 

The participant is electing to have that amount with-held from his pay and added to his 403b plan so that the net tax impact will be zero.  The participant is aware of the maximum contribution issues for his 403b and will not exceed that amount.  Are there any problems?

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