Unused Commuter Fringe Benefits Can’t Go into Health FSA

Due to remote work arrangements, some employees who had opted for a transportation fringe benefit (e.g., free parking; commuter passes) through a compensation reduction agreement may not have used up their committed amounts. The IRS ruled that unused amounts cannot be contributed to a cafeteria plan offering a health flexible spending account (FSA). Transportation fringe benefits can’t be offered through a cafeteria plan. Thus, unused amounts can’t be used for a health FSA offered through a cafeteria plan. #IdeaoftheDay