Compensation Strategies Group, Ltd.
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|What Can an Employer Do with Health FSA Forfeitures?|
Wolters Kluwer Law & Business
June 22, 2015
"Under proposed IRS regulations ... these forfeitures may be:  retained by the company;  used to reduce required salary reduction amounts for the immediately following plan year, on a reasonable and uniform basis;  returned to employees on a reasonable and uniform basis;  used to increase the annual coverage amount; or  used to defray administrative expenses. Under the proposal, the forfeitures can never be allocated among employees based on their individual claims experience."
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