FSA Use-it or Lose-it Rule Hits the Highway for Two Years

During the pandemic, many employees couldn’t use their Flexible Spending Account (FSA) dollars due to the closure of day care facilities and summer camps and the postponement of health care services. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 (the Act) allows XPO to automatically carry over any unused FSA account balances for the 2020 and 2021 plan years into the next plan year. You can use the carryover amounts on claims incurred in the new plan year. Click here for additional details.

What You Need to Do

If you had an unused Health Care FSA (HCFSA) or Dependent Care FSA (DCFSA) account balance at the end of 2020, what you need to do — or not do ­— depends on your situation.

YOUR SITUATIONWHAT YOU NEED TO DO
If you enrolled in the HCFSA or DCFSA for 2021 …You don’t need to do anything. WageWorks* will carry over your unused account balance to your PayFlex HCFSA or DCFSA in April 2021.
If you did not enroll in either the HCFSA or DCFSA for 2021 …You don’t need to do anything. XPO will automatically re-enroll you effective January 1, 2021 so you won’t have a gap in coverage. WageWorks* will carry over your unused account balance to a PayFlex HCFSA or DCFSA in April 2021.
If you enrolled in the HSA for 2021 …Your unused HCFSA account balance will not carry over to your HSA and will be forfeited.
If you leave XPO …You don’t need to do anything. You can access your unused account balance (up to the amount you actually contributed) through the end of the year in which you leave, without a need to enroll in COBRA.

* Just a reminder that XPO changed FSA vendors from WageWorks to PayFlex effective January 1, 2021.