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FROM THE OFFICE OF PUBLIC AFFAIRS <br /> <br />To Hew or print the PDF content on this page, download the free Adobed~ Acrobal~ <br />Reader. <br /> <br />May 18, 2005 <br />JS-2456 <br /> <br />Treasury and IRS to Provide More Time to Spend <br /> FSA Funds <br /> <br />WASHINGTON, DC - Today the Treasury Depadment and the IRS issued Notice <br />2005-42 which will allow employers to modify Flexible Spending Arrangements <br />(FSAs) to extend the deadline for reimbursement of health and dependent care <br />expenses up to 2½ months after the end of Ihe plan year. Previously, employees <br />were required lo 'use-or-lose' FSA funds by the end of the year. Under the old <br />rules, any unspent funds at year's end would be fodeitad. <br /> <br />'The new rule will give workers with FSAs more time to pay for medical and <br />dependent care expenses and will ease the year-end spending rush prompted by <br />the prior rule,' stated Treasury Secretary John Snow. 'Putting people back In <br />charge of their own care is one of the most important things we can do to <br />strengthen our health care system. That's why President Bush has made it a <br />priority to make it easier to access and pay for care through FSAs and to <br />encourage consumer driven health care Initiatives such as Health Savings <br />Accounts.' <br /> <br />FSAs allow employees to pays for uncovered or unraimbursed medical costs with <br />pm-tax funds. FSAs ara different than Health Savings Accounts (HSAs), which <br />allow individuals and families with high-deductible health care plans to set pre-tax <br />money aside for health expenses. Unlike an FSA, which must be spent within a <br />certain period of Ume, HSAs can be rolled over from one year Io the next. <br /> <br />REPORTS <br /> <br />· The text of Notice 2005-42 <br /> <br /> <br />