What is FSA Account?
FSA (Flexible Spending Account) is an account that allows employees to set aside pre-tax dollars for qualified medical expenses. This account is funded through payroll deductions, and the funds can be used for copays, deductibles, prescriptions, and other medical expenses.
How to Open FSA Account?
Opening an FSA account is simple and easy. Here are the steps:
- Contact your employer’s HR department to find out if they offer FSA.
- If they do, ask for the enrollment form.
- Fill out the enrollment form and choose the amount you want to contribute.
- Submit the form to HR.
What are the Eligible Expenses?
Eligible expenses for FSA accounts include:
- Prescription medications
- Copays and deductibles
- Medical supplies
- Vision expenses
- Dental expenses
- And more!
How Much Can I Contribute?
The maximum amount you can contribute to an FSA account is set by the IRS. For 2023, the maximum contribution is $2,900 per year per employee.
What Happens to the Money I Don’t Use?
Any money that you don’t use by the end of the plan year is forfeited. However, some employers offer a grace period of up to 2.5 months after the end of the plan year to use the funds.
Can I Change My Contribution Amount?
Yes, you can change your contribution amount during the plan year if you experience a qualifying life event, such as marriage, birth of a child, or divorce.
When Can I Enroll?
Most employers offer open enrollment for FSA accounts once per year. This typically occurs during the fall, with a plan year start date of January 1st.
Can I Have Both FSA and HSA Accounts?
No, you cannot have both FSA and HSA (Health Savings Account) accounts at the same time. However, you can have a limited-purpose FSA that covers only dental and vision expenses and an HSA for other medical expenses.
What Happens if I Leave My Job?
If you leave your job, you may be able to continue using your FSA account through COBRA. However, you will have to pay the full premium, including the employer portion.
Can I Use FSA Funds for Over-the-Counter Medications?
Yes, you can use FSA funds for over-the-counter medications, but only if they are prescribed by a doctor.
How Do I Submit Claims?
You can submit claims for reimbursement through your FSA provider’s website or mobile app. You will need to provide documentation, such as an itemized receipt or Explanation of Benefits (EOB).
Opening an FSA account is a great way to save money on medical expenses. Make sure to check with your employer to see if they offer FSA and enroll during open enrollment. Keep track of your expenses and submit claims for reimbursement to get the most out of your FSA account.
- Keep track of your expenses throughout the year to avoid forfeiting any unused funds.
- Submit claims for reimbursement as soon as possible to avoid missing the deadline.
- Check with your FSA provider for a list of eligible expenses.
- Consider enrolling in a limited-purpose FSA if you have an HSA account.
|FSA||Flexible Spending Account|
|COBRA||Consolidated Omnibus Budget Reconciliation Act|
|EOB||Explanation of Benefits|