FSA Considerations
Is an FSA right for you? A Health FSA could save you money if you or your dependents:
- Have out-of-pocket expenses like co-pays, coinsurance, or deductibles for health, prescription, dental or vision plans
- Have a health condition that requires the purchase of prescription medications on an ongoing basis
- Wear glasses or contact lenses or are planning LASIK surgery
- Need orthodontia care, such as braces, or have dental expenses not covered by your insurance
How does the FSA Plan Work? It’s easier than you think!
- Decide how much to set aside to pay for qualified medical expenses
- Complete the Enrollment Form- your contribution amount remains in effect all year. Adjustments are allowed if you experience a Qualified Life Event.
- You will receive a special Master Card to use at point of service for Qualified Medical Expenses. Certain services will require manual submissions. You can submit claims incurred in 2018 until March 15, 2019
You can use pre-tax dollars to pay for office visits, co-pays, prescriptions, and prescription glasses, dental and vision expenses. For a complete list of qualified medical expenses visit www.irs.gov/publications/p502.
An FSA is user-friendly. If you have unused funds in your FSA past the 90-day run-out period, up to $500 can roll over into the next plan year!
FSA EXAMPLE
This year, Sam’s family will have expenses for office visits and prescription copay that will total at least $400. In addition, his wife plans to get new eyeglasses that will cost $220 and his son’s braces will cost $1,200. In total, his expenses are $1,820 for the year.
| Assumes 15% tax bracket | With a Medical FSA | Without a Medical FSA |
| Annual gross pay | $25,000 | $25,000 |
| Less: Pretax FSA deduction | — 1,820 | -0- |
| Taxable income | $23,180 | $25,000 |
| Income and FICA taxes withheld | — 2,777 | — 3,250 |
| Net Pay | $20,403 | $21,750 |
| Plus: FSA disbursement | + 1,820 | N/A |
| Disposable income | $22,223 | $21,750 |
| TAX SAVINGS | $473 |
