Earlier this year, the IRS released Notice 2020-33 which allows for greater flexibility for unused funds in a Flexible Spending Account (FSA) for the 2020 plan year. Employers have the option to increase their annual FSA carryover from $500 to $550 for the end of the 2020 plan year. Going forward, the maximum carryover amount will be indexed in later years based on inflation.
For those that choose to increase the FSA carryover, the amendment to your plan document must be adopted on or before December 31, 2021. If Lifetime Benefit Solutions also prepares your plan document and summary plan description, we can prepare the plan amendment and Summary Material Modification necessary for this update.
If you would like to take advantage of this offering, please contact your dedicated Lifetime Benefit Solutions FSA account administrator.