Edited 1/21/21 3:26 PT
@catsnrabbits You only pay tax on used for unqualified expenses. Anything that you left in the account is generally forfeited, although the rules have relaxed due to Covid.
According to IRS Notice Notice 2020-29 for unused amounts remaining in a health FSA or a dependent care assistance program under the § 125 cafeteria plan as of the end of a grace period or plan year ending in 2020, a § 125 cafeteria plan may permit employees to apply those unused amounts to pay or reimburse medical care expenses or dependent care expenses, respectively, incurred through December 31, 2020.
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