A run-out period is an extension of time after the end of a plan year that allows employees to submit claims for eligible healthcare expenses incurred during that previous plan year. This feature gives employees additional time to gather documentation and file claims, particularly for expenses incurred near the end of the year.
The IRS permits employers to offer a run-out period for Health Care FSAs, Limited Purpose FSAs (LPFSAs), and Dependent Care FSAs (DCFSAs), but it is not required. Without a run-out period, employees generally must submit all claims by the last day of the plan year.
The length of the run-out period is determined by the employer—not the IRS. While employers can choose the timeframe that best fits their plan design, a 90-day run-out period is one of the most common options.
To confirm the run-out period for your current plan year, log in to Forma Admin and navigate to the Benefits section. You’ll see details for all your Forma administered benefits, including the run-out period.
Example
An employee has $500 remaining in their 2025 FSA and visits the doctor on December 15, 2025, paying $400 for an eligible medical expense. They forget to submit a claim for reimbursement before the end of the plan year.
If the plan does not include a run-out period, the employee would generally lose the opportunity to submit that claim once the plan year ends and would not be reimbursed for the December expense.
If the plan includes a 90-day run-out period, the employee would have until March 30, 2026, to submit a claim for the eligible expense incurred on December 15, 2025. After the claim is approved, they would be reimbursed from their remaining 2025 FSA balance.