In addition to establishing the annual limit, the notice includes detailed guidance for employers.
The notice also includes a request for comments from employers on the “use-or-lose” rules for health FSAs. The new guidance provides for a “grace period” of up to two months and 15 days from the contribution date for salary contributions to be used for a plan year. The IRS is interested in suggestions for additional flexibility besides the grace period, and how those modifications would interact with the annual contribution limit. The IRS is accepting comments until August 17, 2012.