It would not. Carryover allows amounts in a healthcare FSA – limited purpose or otherwise – to carry over into the next plan year. The Carryover option will follow the participant’s choice. If a participant elects a limited purpose FSA for the current plan year, and has a carryover, the carryover will follow them into the limited purpose FSA for the new plan year. Similarly, if the participant elects a healthcare FSA in the current plan year and has a carryover, the carryover will follow them into a healthcare FSA for the new plan year.
However, if a participant elects to participate in an HSA for the new plan year, and currently has a healthcare FSA, the participant should either spend all amounts in the healthcare FSA before the plan year ends, or enroll in a limited purpose FSA for the new plan year so they can contribute to the new HSA on the first day of the following plan year.