New FSA Policy Effective for Reservists

Federal employees who have health care flexible spending accounts and who are called to active military duty for at least 180 days are now eligible for a refund of unspent money in that account, OPM has said in a memo to agencies. Under the policy, which implements a provision of a reservist tax relief act (PL 110-245) effective at the start of this year, a “qualified reservist distribution” can be made, but the distribution will be taxable income and the distribution will close the account and no additional claims can be made against the account. Eligible persons can make the request starting with the date of call to active duty by contacting the FSA carrier, FSAFEDS.