Flexible Spending Account Reminder
FSAs are a great way to save money by paying for certain health care and dependent care expenses tax-free. You may contribute to a Health Care FSA, a Dependent Care FSA, or both.
The money you contribute is taken from your pay before taxes are deducted — this lowers your taxable income, which means lower taxes for you!
You must re-enroll if you want to contribute payroll deductions to an FSA in 2015. Your current payroll deduction elections will not automatically roll over. However, if you are currently enrolled in a Health Care FSA, up to $500 of unused 2014 FSA dollars will roll over automatically into an FSA for 2015. These rollover funds do not count toward the annual contribution limits.
You can contribute up to $2,500 annually to your Health Care FSA. Eligible expenses include:
- Copays, deductibles, and coinsurance
- Smoking-cessation programs
- Vision care or services not covered by your plan, including contact lens solution and LASIK surgery
- Hearing exams and hearing aids
- Certain over-the-counter medications as prescribed by a physician
For the Dependent Care FSA, you generally can contribute up to $5,000 per married couple each year (up to $2,500 per year if you and your spouse file separate tax returns). Eligible expenses include:
- Babysitters (provided they’re not your child under age 19 or someone you claim as a dependent on your tax return)
- Care at licensed nursery schools, day camps and day care centers
- Household services for the care of an elderly or disabled adult who lives with you
To find a complete list of eligible FSA expenses, please visit the IRS Web site at http://www.irs.gov. Publication 502 lists all eligible Health Care FSA expenses, and Publication 503 lists all eligible Dependent Care FSA expenses.