Flexible Spending Flexible Spending AccountsAccounts
Employee Benefits
Outline of PresentationOutline of Presentation
• What is a Flexible Spending Account (FSA)?• Two Types
– Medical– Dependent Care
• Examples of Eligible/Ineligible Expenses• Reimbursement • Enrollment Information• Questions
Employee Benefits
What is an FSA? What is an FSA?
• A Flexible Spending Account (FSA) is an employer-sponsored benefit that allows you to pay for eligible medical and/or dependent care expenses on a pre-tax basis.
• You direct a part of your pay into a special, tax-free account that you use to reimburse yourself for eligible out-of-pocket medical and dependent care expenses.
• Contributions used for FSAs are taken out of your salary before federal/state income taxes, FICA (Social Security and Medicare) taxes are applied.
Employee Benefits
AN EXAMPLEAN EXAMPLE• John earns $35,000/year.
• Medical Spending Account: $240/year ($10.00/pay)
• July 2009- Eyeglasses ($240)– Debit Card– Manuel Claim
Employee Benefits
WHAT ADVANTAGES WHAT ADVANTAGES DID THIS GIVE JOHN?DID THIS GIVE JOHN?
REDUCTION IN W2 EARNINGS
REPORTABLE W2 EARNINGS WITH JOHN’S SPENDING ACCOUNT ELECTION ARE NOW $34,760.
Employee Benefits
INCREASE IN TAKE HOME PAYW/OUT SPEND.
ACCOUNTWITH SPEND.
ACCOUNT
EARNINGS $ 35,000.00 $ 34,760.00
S.S. TAX (7.65%) - $2677.50 - $2659.14
F.I.T. TAX (20%) - $7,000.00 - $6952.00
STATE TAX (3%) - $1,050.00 - $1,042.80
$24,272.50 $24,106.06
MEDICAL EXPENSE - $ 240.00 - $0
TAKE HOME PAY $24,032.50 $24,106.06
Employee Benefits
Two Types of FSAsTwo Types of FSAs
• Medical Spending Accounts– $3,000/Plan Year– Use It Or Lose It Provision
• Dependent Care Spending Accounts– $5,000/Plan Year– Use It Or Lose It Provision
Employee Benefits
Eligible Expenses (Medical FSA)Eligible Expenses (Medical FSA)
• Acne treatment• Acupuncture• Co-pays (Inc. Rx)• Co-insurance Amounts &
Deductibles• Automobile Modifications
(physically handicapped)• Blood Pressure Monitoring
Devices• Blood Sugar Test Kits /Strips
• Carpal Tunnel Wrist Supports• Dental Treatment• Over-the-Counter Drugs• Hearing Aids• Laser Eye Surgery/Lasik• Learning Disability, Instructional
Fees• Medic Alert Bracelet or
Necklace• Prescription Glasses• Wheelchair
Employee Benefits
Ineligible Expenses Ineligible Expenses (Medical FSA)(Medical FSA)
• Cosmetic Surgery• Dancing Lessons• Diaper Service• Electrolysis or Hair Removal• Funeral Expenses• Future Medical Care• Hair Transplant• Health Club Dues• Household Help• Insurance Premiums
• Maternity Clothes• Swimming Lessons• Teeth Whitening
• Veterinary Fees
Employee Benefits
Eligible Expenses Eligible Expenses (Dependent Care FSA)(Dependent Care FSA)
• Adult Daycare• After-School Care• Babysitter (work-related)• Before-School Care• Day Camp• Daycare• Room and Board (Nanny)• Tuition (Nursery and Preschool)
Employee Benefits
Ineligible Expenses Ineligible Expenses (Dependent Care FSA)(Dependent Care FSA)
• Babysitter (Personal)• Food• Housekeeper• Overnight Camp• Tuition (K+)
Employee Benefits
ReimbursementReimbursementPY 2008-2009PY 2008-2009• Deadline for claims submission to Loomis is 05/31/09.
• Claim must be incurred prior to 06/01/09.
• 06/01/09 – 08/31/09– Complete Loomis Claim Form– Submit form to Human Resources– Checks will be run every Thursday
Employee Benefits
ReimbursementReimbursementPY 2009-2010PY 2009-2010
• Administer by AmeriFlex
• MBI Card and/or Claim Forms
• Check or Direct Deposit
Employee Benefits
Enrollment InformationEnrollment Information
• Complete the AmeriFlex Application
• If you are currently enrolled in a Flexible Spending Account, you must re-enroll for the new plan year. You will not be automatically enrolled.
• Deadline: Friday, May 1st
Employee Benefits
QuestionsQuestions
