Benefits & Options

Benefits & Options

You may want to consider a Flexible Spending Account (FSA), if you have expenses not covered by any health care plan, anticipate higher health care expenses, or have dependents living with you. FSAs give you an opportunity to save on taxes by paying for eligible health care and dependent day care expenses with pre-tax dollars.

What are the benefits of FSAs?

Because the money you save is deducted from your pay before federal and, in most cases, state income taxes, using these accounts lowers your taxable income. That means you pay taxes on a lesser amount of money.

What are my options?

There are two options: the Health Care FSA and the Dependent Day Care FSA. Both FSAs are provided to you through WageWorks.

Health Care FSA Dependent Day Care FSA
Reimburses you for certain eligible expenses that aren’t paid in full or covered under your medical, dental and/or vision care programs. Designed to help you pay for the cost of child and/or adult care so that you – or if you’re married, you and your spouse – can work.
See the eligible expenses here. See the eligible expenses here.

Can I use both FSAs for the same expense?

No. You cannot use your health care account to pay for dependent day care expenses, or vice versa. You must keep copies of your receipts for substantiation purposes by WageWorks or in case of an IRS audit of your FSA expenses.

How does it work?

You decide how much you want to put into one or both of the FSAs when you enroll. Your contributions are automatically deducted from each paycheck on a pre-tax basis, and accumulate in your account(s).You’re paid back from your account(s) with the pre-tax dollars you’ve been saving.

Are there any restrictions?

Because you gain tax advantages when you use these accounts, the IRS puts certain restrictions on how they work. If you do not use all of the money you deposit during the Plan’s designated timeframe – during the calendar year – the IRS requires that you forfeit the unused balance and they cannot be refunded. Per Plan guidelines, your unused contributions cannot be rolled over into the next year.

The plan year for both FSAs is the calendar year (January 1 – December 31). All expenses must be incurred during the plan year, but you have until March 31 of the following year to submit your claims.

Health Care FSA Dependent Day Care FSA
Minimum $120 $120
Maximum $2,650 $5,000 ($2,500 if married and filing separate returns)

For more details, see the FSA Summary Plan Description.