Deduction and Cafeteria Plans

This year, I signed up for a cafeteria plan that witheld $50 per biweekly paycheck. In August, I was planning on job change. The HR department at my current position, and the company managing the deposits, both stated that I would have until 12-31-00 to use the money. I took another position, and when I made a claim. It was denied due to the end of the plan was when I terminated my relationship w/ my employer. Can I deduct the loss ($1050.00) on my 2000 taxes?

soething's not right

Check the company guidelines regarding that deduction. You authorized them to take your property (money) for potential future use. Any portion not used should be returned to you in full...period. Unless it was stated that the unused portion would be used as some sort of charity donation.

If they can give you some sort of receipt for the unused portion that states Charitable Contrabution....there is your deduction.

I think I can shed some light on Frouge's situation, but I'm also looking for answers. I've had an almost identical experience, where I was making regular contributions to a so called Flexable Spending Account (FSA) or Health Care Re-imbursement Account,through my employer up until the time I retired at mid-year. When I tried to get re-imbursed for a medical expense incurred just after my retirement,they threw "catch 22"at me also,explaining that the "use-it-or-loose-it" clause does not always mean that you have till the end of the calender year. The fine print in their "Plan Document" states that when you terminate ,your participation in the plan ends and if you have any cash balance, it can only be applied to expenses incurred before you terminated.Thats the Company's and Administrators position but I really wonder if it's what the IRS had in mind.The appropriate part of the IRS Code is Section 125,but I've yet to find a copy for myself.
The only good news is your contributions were made "before taxes" and dont show up as income.