Flexible Spending Accounts (FSAs)
Flexible Spending Accounts (FSAs) offer a convenient way for you to pay for certain health and dependent care expenses while saving on taxes. When you direct part of your pre-tax salary to an FSA, you lower your taxable income. Generally, this means you pay less in taxes and have the opportunity to receive more take-home pay.
You may participate in one or both FSAs, administered by Benefit Strategies, even if you do not enroll in medical, dental, and/or vision plans offered by the Elliot Health System.:
Health Care FSA
The Health Care FSA helps you pay eligible out-of-pocket health care expenses for you and your eligible dependents, that are not covered or fully reimbursed by your medical, prescription drug, dental, and vision coverage. Examples of eligible expenses under a Health Care FSA include plan deductibles, coinsurance, and copayments (please visit www.benstrat.com for a full list of eligible expenses). The calendar year max is $2,500.00.
Dependent Care FSA
The Dependent Care FSA helps you pay for eligible dependent care expenses incurred while you (and your spouse) work. Examples of eligible expenses under a Dependent Care FSA include costs for eldercare or childcare for eligible dependents. The calendar year max is $5,000.00.
Money is diverted out of each of your paychecks on a pre-tax basis and put into a Health Care FSA and/or a Dependent Care Assistance Account. Since the money you choose to put into the FSA accounts are non-taxable, you will save Federal Income Tax (10% – 35%), FICA (7.65%), and, if applicable, State Income Tax (0-6+%). The savings range from 17.65% to 48.65% depending on your federal tax bracket and the state you live in.
Once enrolled, you are allowed to draw money out of the accounts to reimburse yourself for out-of-pocket medical and/or dependent care expenses incurred during the plan year which are not reimbursed from insurance or other sources.