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By Debra Roth

Q & A Session: Dependent Care FSA vs. Medical Expense FSA

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Q:

I lost my job a week ago, and I discovered that I accidentally signed up for a Dependent Care FSA Account at my last benefits enrollment when I meant to sign up for a Medical Expense FSA Account. I already have a balance of $1,300 in the Dependent Care FSA. Is there any way I can get this money back?

A:

Please consult your benefits representative for further information or questions, but it appears that you have no recourse to the $1,300 balance in your FSA account. Your Dependent Care Account (DCA) is an employer sponsored benefit. Your participation in the DCA ends on the day you separate from your employer. If you still have funds remaining in your DCA, you have a 90 day “run out” period from your official separation date to submit claims for eligible plan expenses incurred before your separation date (any expenses incurred after your separation are not eligible).

Dependent Care Accounts (DCA) can be used to pay for (1) child care of a dependent under 13 so that the parent(s) can work; or (2) elder care of an adult dependent.

Also, you may only change the amount in your FSA balance if you experience a change in status or other qualified event, based on IRS regulations, such as:

  • A change in legal martial status (marriage, divorce, or death of your spouse).
  • A change in the number of your dependents (birth of adoption of a child, or death of a dependent).
  • An event causing your dependent to satisfy or cease to satisfy an eligibility requirement for benefits.

Visit www.fsafeds.com for more information.

This response is written by Maria N. Coleman, associate attorney of Shaw Bransford & Roth PC.

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