Medical Spending Account

[Guest perplexedbypensions]

Hello. My husband was laid off from his job on Monday. There were two payrolls processed for 2008, in which he had $250 withheld for health care reimbursement - we had chosen a high amount in anticipation of future bills. We have not yet incurred any expenses in 2008. Are there any exceptions to the "use it or lose it" rule for instances like this?

Thank you!

[papogi]

No exceptions that I am aware of. This would be a good opportunity to elect flex COBRA and to continue the account at least up to the point where your bigger bills later in the year will be reimbursable, then you can drop the account. If your bills are spread out evenly over the whole year, it would still be to your benefit to continue the account up to the end of the plan year. Even if you lose the pre-tax benefit and have to pay the usual 2% COBRA admin fee, your losses will likely be far less than the $500 you stand to lose right now with nothing currently reimbursable.