Flexible Spending Accounts
Flexible Spending Accounts (FSAs) allow you to pay for eligible health and dependent care expenses with pre-tax dollars, eliminating federal and state income taxes and FICA tax on these expenses. They also offer the convenience of a debit card for transactions.
Washington and Lee's FSA program is administered by Flexible Benefit Administrators Inc. (FBA), which offers both Health Care and Dependent Care Spending Accounts. Participants must re-enroll annually to continue the benefit. All benefit eligible employees are eligible to participate.
Health Care Spending Account
A Health Care FSA provides you with the ability to save money on a pre-tax basis for any IRS-allowed health expenses not covered by your health coverage. These expenses include, but are not limited to, deductibles, copayments, coinsurance payments, uninsured dental expenses,over-the-counter medications with a prescription from a physician, vision care expenses (e.g. eyeglasses or contact lenses), hearing care expenses (e.g. a hearing exam or hearing aid) and orthodontia expenses.
The maximum annual amount you can deposit into a Health Care FSA is $2,750 for the 2020-21 plan year. Balances up to $500 will be carried automatically into each new plan year. The carryover does not lessen the $2,750 maximum you can elect.
Dependent Care Spending Account
A Dependent Care FSA provides you with the ability to set aside money on a pre-tax basis for daycare expenses for your child, disabled parent or spouse. These services are only eligible for reimbursement if they allow you and your spouse (if applicable) to work. Generally, expenses will qualify if they are the result of care for:
- your children, under the age of 13, for whom you are entitled to a personal exemption on your Federal Income tax return; and
- your spouse or other dependents, including parents, who are physically or mentally incapable of self-care and lived with you for more than half the year.
The maximum annual amount you can deposit into a Dependent Care FSA is $5,000 for the 2020-21 plan year.