If you have a flexible spending account through work, there's a decent chance you're about to leave real money on the table.
The use-it-or-lose-it rule still applies to most accounts, and the calendar year deadline trips up millions of workers annually.
Unlike a bank account, an FSA doesn't roll over by default — you either spend the balance or forfeit it back to your employer.
The exact cutoff depends on your plan, not the IRS.
Many employers set a grace period that lets you spend leftover funds until March 15 of the following year.
Others offer a carryover, which lets you roll a limited amount — currently $640 per year, indexed for inflation — into the next plan year.
You have to check your own paperwork or benefits portal to know which rules apply to you.
The tricky part is that eligible expenses aren't always obvious.
Over-the-counter medicines now qualify without a prescription, thanks to a change that took effect in 2020.
That includes pain relievers, allergy pills, cold medicine, and menstrual products.
Bandages, first aid kits, contact lens solution, and even some sunscreen count too.
Dependent care FSAs follow different rules and have their own deadline quirks, so don't assume one account's terms match the other.
If you're scrambling, there are a few practical moves.
You can stock up on eligible items at a pharmacy or big-box retailer and submit receipts before the cutoff.
You can also prepay for services you'll use soon, like a dental cleaning or an eye exam, as long as the service is provided by the deadline.
Reimbursement claims often have a separate filing window that extends past the spending deadline — sometimes by 90 days or more.
That means you might be able to spend now and submit the paperwork later.
Missing that second deadline is just as costly as missing the first.
Log into your FSA administrator's website, find your remaining balance, and compare it against upcoming appointments or prescriptions.
If you wear glasses or contacts, a new pair or an exam can absorb a chunk of the balance fast.
Dental work you've been putting off is another common way to use funds before they vanish.
One caution: you can't reimburse the same expense twice, and you can't claim something you never actually paid for.
Keep itemized receipts, not just credit card statements, since administrators often reject vague documentation.
If you're unsure whether something qualifies, the IRS publishes a searchable list, and your plan administrator can usually confirm in a day or two.
The bottom line is that an FSA only helps if you use it.
A few minutes of checking your balance and deadline now beats losing hundreds of dollars you already set aside.
Final Thoughts
Treat the deadline like a bill that's due, because ignoring it costs you just as much.