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Balderson, Axne Introduce Bipartisan Legislation to Give Families Access to Unused Savings During COVID-19

Washington, August 11, 2020

WASHINGTON – Representatives Troy Balderson (R-OH) and Cindy Axne (D-IA) today introduced bipartisan legislation that would provide Ohio families additional options to ease financial burdens during the COVID-19 pandemic. The COVID-19 Health and Dependent Care Flexible Spending Account Distribution Act would enable employees who use health flexible spending accounts (FSAs) and dependent care assistance plans (DCAPs) to access unused funds in these accounts through the remainder of any year of the current public health emergency.

“Ohioans want to go to bed every night feeling financially secure,” said Balderson. “This legislation will make a difference in their lives by allowing flexibility to spend restricted dollars to fit their families’ needs without risk of losing their savings at the end of the year, helping cushion any financial strains they may be experiencing.”

Many families in Ohio’s 12th Congressional District use FSAs and DCAPs, which allow employees to set aside pretax income for qualifying health and child care expenses. While these accounts are popular because of their tax-advantaged status and flexible benefits, the pandemic presents a new challenge because the plan funds are “use it or lose it” by the end of the plan year. The COVID-19 pandemic has forced the temporary closure of many child care facilities and a delay in elective health care services, rendering FSA and DCAP funds unusable at a time when many Ohioans are already experiencing financial strains. The COVID-19 Health and Dependent Care Flexible Spending Account Distribution Act would give Ohio families access to these much-needed dollars by allowing employees to take a one-time distribution from their FSA or DCAP by December 31, 2020.

“This public health emergency has family budgeting all the more difficult for Iowans,” said Axne. “Iowans are seeing scheduled medical procedures postponed and child care centers closed, leaving money they’ve budgeted for future expenses inaccessible when it’s needed to pay the bills today. I’m proud that the legislation I’m introducing today will give Iowa families the flexibility to use this money as they see fit and manage these difficult economic circumstances.”

This bipartisan legislation is endorsed by the Employers Council on Flexible Compensation, National Taxpayers Union, National Association of Insurance and Financial Advisors, and the Self-Insurance Institute of America.

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