Spending accounts help you save money on eligible out-of-pocket health care and dependent day care expenses. Your contributions come out of your paycheck before federal income and Social Security taxes, so you pay less in taxes and may have more take-home pay. You have the option of a:
- Health Care Spending Account
- Dependent Care Spending Account
All spending accounts (HSA, FSA & DCSA) are administered by HealthEquity. You can contact them at 888-769-8696 or www.healthequity.com
- If you contribute to a Health Savings Account (under the High-Deductible Health Plan), you cannot participate in the Health Care Spending Account (under the Standard PPO).
- Both accounts must be treated separately. For example, you cannot use money deposited in your Health Care Spending Account to cover dependent day care expenses or vice versa. Funds cannot be transferred from one account to the other.
- All the money in the Spending Accounts each year must be exhausted. Any money remaining at the end of the year cannot be carried over and it is forfeited - “use it or lose it.”
This account allows you to use pre-tax dollars to pay for eligible health care expenses incurred by you or any other person you cover under you health care benefits or claimed as a dependent on your federal income tax return (even if you do not cover them on your medical benefits).
In general, eligible expenses include those that are not covered by your medical plan, such as: deductibles, copayments and coinsurance; and prescription drug, dental, vision and hearing expenses.
You can contribute up to $2,750 per year in the Health Care Spending Account.
See a list of qualified medical expenses.
You may use this account to pay for care of your eligible dependents so you (and your spouse) can work (or actively look for work) or attend school full-time.
Generally, an eligible dependent is:
- Your child under age 13 (as long as you or your spouse is entitled to the income tax exemption for the child)
- Your disabled spouse
- A disabled dependent of any age who lives with you at least eight hours per day
Expenses eligible for reimbursement generally include:
- Child care at a day camp, nursery school or private sitter
- Expenses for preschool and after-school child care
- Cost of a housekeeper whose duties include care of a qualified dependent
- Elder care for an incapacitated adult who lives with you at least eight hours per day
When you file your federal income tax return, you will be required to supply the name, address and Social Security or tax identification number of the individual or organization providing dependent care. If you are unable to supply this information, you should not use the DCSA to pay for these dependent care services. Also, if you participate in the DCSA, you cannot claim the child care credit for these expenses on your federal tax return.
You can contribute up to $5,000 per year ($2,500 if married and filing separately).