When Does FSA Rollover?

If you have an FSA (Flexible Spending Account), you might wonder: "What happens to the money I didn’t spend by the end of the year?" The answer depends on your job’s plan, but let’s break it down simply.

Some FSA plans let you roll over a small amount of unused money into the next year. In 2025, you might be able to carry over up to $660. But not all jobs offer this. Some give you a grace period instead of about 2.5 more months to spend your leftover money. You only get one option: either the rollover or the grace period, not both.

When Does the Rollover Actually Happen?

Here’s where it gets a bit more detailed. The rollover doesn’t always happen right after the new year starts. Even if your plan ends on December 31, most plans give you extra time called a run-out period to send in receipts for the past year’s expenses. This period usually lasts up to 90 days.

Once that time ends, your leftover money up to the $660 limit can get added to your FSA for the new year. So if your plan ends December 31 and the run-out period ends March 31, you might not see your rollover until sometime in April.

Some plans might roll over money sooner, maybe even in January. But it depends on how your plan works. For example, government workers with FSAFEDS might see their rollover earlier, but each plan is different.

Why Should You Care?

Knowing when your rollover happens helps you plan better. Let’s say you have a big doctor or dentist bill in January. If your rollover isn’t added until April, you might have to pay that bill yourself unless you already put new money into your FSA.

Also, don’t forget you usually have to sign up again for your FSA each year. If you skip that, you might lose any leftover money, even if your plan has a rollover.

Your FSA rollover usually happens after your plan year ends and after the run-out period finishes. Some plans roll it over right away, but others wait until old claims are sorted out. The best thing you can do? Check your plan rules so you know exactly what to expect. It could save you money and help you use your benefits better.

What Are the FSA Rollover Rules in 2025?

Let’s make this easy to understand. If you have a Flexible Spending Account (FSA), you might be wondering what happens to the money you don’t use by the end of the year. In 2025, there are some updated rules, so here’s what you need to know in plain language.

1. How Much Money Can You Keep?

If your plan allows it, you can keep up to $660 of unused FSA money from 2025 and use it in 2026. That’s a little more than last year, which was $640. This money gets added on top of what you’re allowed to put in next year. So in 2025, you can still add $3,300, even if you have rollover money.

For example: If you roll over $660 and add $3,300 in 2026, you’d have a total of $3,960 to spend. But your job has to allow this rollover not all employers do.

2. Rollover or Grace Period You Only Get One

Your plan will give you one of two options:

• A rollover (carry up to $660 into the next year), or
  
• A grace period (get 2.5 extra months to use leftover money).
  

You don’t get both. Your employer picks which one your plan will use.

3. Do You Need to Sign Up Again to Keep the Money?

Maybe. Some plans make you re-enroll to use your rollover money. Others don’t, and they’ll let you keep it even if you don’t sign up again (usually with a $0 election). Make sure to read the info your employer gives you during open enrollment.

Also, you have to still be working at your job to use rollover money. If you quit or leave before the new year starts, you might lose it.

4. When Do You Get Your Rolled-Over Money?

You usually won’t see that money right away. Most plans wait until something called a run-out period ends. This is usually about 90 days after the year ends a time when you can still turn in receipts from last year.

So if your plan ends December 31 and the run-out period ends March 31, you probably won’t see your rollover money until April. Some plans do it faster, but most wait until they’ve finished checking all the claims.

5. What If You Have a Dependent Care FSA?

That’s a little different. These types of FSAs usually don’t let you roll over money. Some of them might give you a grace period instead. So don’t expect to keep leftover funds unless your plan says you can.

6. What If You Have More Than $660 Left?

If you end the year with more than $660 and your plan has a rollover, anything over the limit is gone. So if you have $700, only $660 rolls over the other $40 disappears unless you spend it in time.

So Basically,

FSA rollover rules in 2025 are pretty helpful but only if you understand how they work. Here’s how to stay on track:

✅ Ask if your plan uses rollover or grace period
✅ See if you need to re-enroll to keep leftover money
✅ Watch for deadlines like the run-out period

And if you’re ever confused, ask your HR team. A quick question could help you keep money you might have lost.

That’s the real deal: simple, useful, and focused on what actually matters for your wallet.

What Happens If I Don’t Use My FSA by Year-End?

If you have money left in your FSA and the year is almost over, you might wonder: "Will I lose that money if I don’t use it?" The answer depends on the kind of FSA plan your job gives you. Let’s make it easy to understand.

The "Use It or Lose It" Rule

FSAs have a rule called "use it or lose it." This means if you don’t spend the money by the deadline, you could lose it. It won’t automatically move to the next year.

But some jobs give you one of these two options instead:

1. Grace Period - You get 2.5 more months (usually until March 15) to spend the money.
   
2. Carryover - You can keep up to $660 and use it any time next year.
   

Employers pick one or the other; they can’t offer both.

Three Things That Could Happen

Here’s what might happen with your leftover FSA money:

1. No Grace Period or Carryover - If your plan has neither, and you don’t use your money by December 31, 2025, you lose it.
   
2. Grace Period - Some plans let you use your 2025 money until March 15, 2026. But if you don’t spend it by then, it’s gone.
   
3. Carryover - If your plan lets you carry money over, up to $660 can move into 2026. But it usually won’t show up until after a waiting time (called a run-out period), which could be as late as April or May.

Why Is It Important?

You don’t want to throw away money. The IRS made these rules so FSAs don’t turn into long-term savings accounts. If your job gives you a grace period or carryover, that’s good but you have to know which one you get.

Some plans make you sign up again each year to keep your carryover money. Others don’t. And if you leave your job, you might lose the money either way.

Where Does Lost Money Go?

If you lose money in your FSA, it doesn’t come back. Employers might use it to help run the plan or share it with other workers.

Real-Life Example

Let’s say you have $500 left on December 31, 2025:

• No grace or carryover? You lose all of it.
  
• Grace period? You can use it until March 15, 2026.
  
• Carryover? You keep up to $660, but might not see it until April.
  

How to Keep Your Money Safe?

✅ Make a plan: Think about how much you’ll spend on health care.
✅ Check your benefits: Look for "grace period" or "carryover" in the info from work.
✅ Watch your balance: Use your FSA website or app to keep track.
✅ Ask questions: If you're unsure, talk to your HR department.

What happens to your FSA money depends on your job’s plan. That’s why it’s smart to understand your options ahead of time. Knowing if you have a grace period or carryover can help you avoid wasting money and make better decisions for your health spending.

How Do I Know If My FSA Has a Rollover or Grace Period?

If you have an FSA and you're not sure what happens to your money at the end of the year, you're not alone. Some plans let you keep some of the money for next year, and others give you more time to spend it. Here's how you can figure it out.

Step 1: Ask Your HR Department

The quickest way to know? Just ask your HR team. They’re the people who manage your benefits at work. Ask them if your FSA:

• Lets you roll over money (up to $660) to the next year, or
  
• Gives you a grace period (extra 2.5 months to spend leftover money).
  

You can also ask if your plan has a run-out period, which is extra time to send in receipts after the year ends.

Step 2: Read Your Plan Documents

When you signed up for your FSA, you should’ve received some papers or an email that explains how your plan works. Look for words like:

• "Rollover"
  
• "Grace Period"
  
• "Forfeiture"
  

If you don’t have these documents, your HR team or your company’s benefits website can help.

Step 3: Check Online

If you have an account on a website like HealthEquity or FSAFEDS, log in. Look for things like:

• Plan deadlines
  
• How much you can roll over?
  
• Whether you have a grace period
  

Some sites will even give you reminders if a deadline is coming up.

Step 4: Call Your FSA Provider

Sometimes your employer uses another company (called an administrator) to manage your FSA. Their contact info is usually in your welcome packet or on the account website. You can call or email them to ask about your plan’s rules.

Why Is It Important?

If you don’t know your plan’s rules, you could lose money. For example, if you think you can roll over money but you actually have a grace period  and you don’t spend it by March 15  that money is gone.

Knowing the rules also helps you plan better:

✅ Rollover? You can safely save a bit more.
✅ Grace period? Spend what’s left before the deadline.

What’s the Difference Between FSA Rollover and Grace Period?

These two options help in different ways, and your job can only offer one, not both. Here’s a simple chart that shows how they compare:

To avoid losing money, ask your HR team or look at your plan documents to see which one your plan has. That way, you can plan your spending better and keep more of the money you saved.

What Should I Spend My FSA On Before It Expires?

If you have money in your FSA (Flexible Spending Account) and the plan year or grace period is ending soon, don’t wait! If you don’t use that money in time, you could lose it. Here’s how to make sure you spend it on things that count.

What Can I Use My FSA For?

Let’s look at smart ways to use your FSA money if you have a Health FSA:

Health Products

• First aid stuff like bandages, wipes, or thermometers
  
• Medicine you can buy without a prescription like pain or allergy meds
  
• Pads, tampons, heating pads
  
• Sunscreen, hand sanitizer, face masks
  

Medical Visits and Wellness

• Doctor check-ups, therapy, or urgent care visits
  
• Mental health services like counseling
  
• Shots or health checkups
  

Vision and Teeth

• Eye exams, glasses, contact lenses
  
• Dental cleanings, fillings, or braces
  

Baby and Family Care

• Breast pumps, baby thermometers, diaper rash cream
  
• Prenatal vitamins for pregnancy
  

Health Equipment

• Blood pressure or glucose monitors
  
• CPAP machines, hearing aids, braces for your back or knees
  

Travel for Health Reasons

• Money for travel or hotel stays if you need to go far for treatment
  
• Home gear like grab bars or mobility tools (if medically needed)
  

Helpful Tip: Check out FSAstore or Med Paid Market to buy things that are FSA-approved without having to guess.

If You Have a Dependent Care FSA

This kind of FSA is for people who pay for someone else’s care while they work. You can use it for:

• Childcare like daycare or preschool
  
• After-school programs and summer day camps
  
• Care for an older adult who depends on you
  
• Babysitters or nannies (if it helps you work)
  

Quick Tips to Use Your Money Wisely

• Don’t wait too long - doctors and dentists can get busy!
  
• Only buy what you’ll use - no need to buy a bunch of the same thing
  
• Save your receipts - some plans need proof of what you bought
  
• Double-check with your FSA company - some rules are different

Example 1 - Health FSA: You have $300 left. You book a dental cleaning ($100), buy glasses ($150), and order sunscreen and allergy pills online ($50).

Example 2 - Dependent Care FSA: You have $200 left. You pay for two weeks of after-school care before the school year ends.

Try Med Paid Market

Med Paid Market is a great place to shop for FSA-approved products. It's super easy to:

• Find stuff that’s 100% FSA-eligible
  
• Browse trusted health brands
  
• Get fast shipping and great help if you need it
  

✅ Don’t stress shop smart and spend your money before it’s gone at Med Paid Market.

Your FSA helps you save money on health stuff. But remember if you don’t spend it before the deadline, you could lose it. So check your balance, find out when your deadline is, and spend it smartly.

Want to know more? Check out our guide: How to get reimbursed for wellness products with FSA?