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May’s Benefits Buzz – Flexible Spending Account
Why use a Flexible Spending Account,FSA?
An FSA allows you to put aside tax free dollars to use for eligible expenses throughout the year. You must elect a contribution at open enrollment each year. The amount elected is available September 1 and the pre-tax deductions are made over 12 months (September through August)
Remember, if any unused funds remain at the end of the plan year, you may lose that money. Expenses for services must be received during the current plan year. You will then have 90 days to submit receipts for reimbursement after the plan year.
Tax Savings Example
Without FSA
$35,000 Gross Pay -$4,783.75 Taxes =$30,216.25 -$2,400 Medical Costs =$27,816.25 Net Pay
With FSA
$35,000 Gross Pay -$2,400 Medical Costs =$30,216.25 -$4,455.72 Taxes =$28,144.28 Net Pay
Two Types of FSAs
Health Care FSA
Available if you’re enrolled on the Traditional Medical Plan. You may use money contributed to your FSA account for qualified medical, dental, and vision expenses. See IRS publication 969. Maximum Contribution of $2,600 for current year, $2,650 for upcoming 2018 plan year.
Dependent Care FSA
Available regardless of which medical insurance plan you’re enrolled on. This is a completely separate account from the Health Care FSA. Dependent FSA may be used for dependent care expenses while you (and your spouse if applicable) are at work. Maximum Contribution of $5,000.
Need More Information
- Website: www.apachoicepoint.net
- Phone: 801.561.4980
