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My son went to the dentist on 9/22/2014. After the insurance paid a portion of the $125 fee, I was billed $53.60 on 2/25/2015. I submitted my FSA card to cover the balance on 3/12/2015.

When the administrator came to me for the documentation, I submitted the invoice from 2/22/2015. They refused this, saying that I paid for a 2014 service with 2015 funds. I called and noted that I only received the bill in 2015, but they still denied the receipt.

Are they right? I think they are wrong, but I cannot get them to accept the receipt.

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They are right. You can only use the FSA funds for the year in which you accrued the liability, regardless of when you paid it. See the IRS publication 969:

Generally, distributions from a health FSA must be paid only to reimburse you for qualified medical expenses you incurred during the period of coverage.

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  • +1 - this is also why you have a grace period to submit, usually till March 31 of the next year. His 2014 FSA would have covered this. Commented Nov 19, 2015 at 2:04

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