What is an FSA?
Flexible Spending Accounts (FSA) provide you with an important tax advantage that can help you pay health care, dependent care or commuter transit & parking expenses on a pretax basis. By anticipating your family’s costs, you can actually lower your taxable income and that means you get to keep more of what you earn.
Important points to remember:
- You may elect to contribute the maximum amount even if your spouse is also contributing to an FSA at his or her workplace.
- The Health Care FSA allows any qualified medical expense to be reimbursed.
- You may only register in either the FSA program or have a Health Savings Account. You cannot have both.
RESOURCES
Healthcare Flexible Spending Accounts
To determine if a Health Care FSA makes sense for you, estimate your eligible expected expenses for you and (if applicable) your dependents for the calendar year. This amount could be your annual election as long as it doesn’t exceed the allowed contribution maximum. The amount you elect is available to you at the beginning of the plan year, regardless of how much you have contributed via payroll deduction.
Please review the following information so you are aware of the rules applied to the Health Care FSA. This is only a brief summary. More information is available in the Summary Plan Description (SPD).
Dependent Care Flexible Spending Accounts
- Allows you to set aside pre-tax dollars for dependent care expenses, such as daycare, that allow you to work
- 2024 annual contribution limit: $5,000
- Eligible expenses include before and after school care for children up to age 13, custodial care for dependent adults, day care, preschool, and nanny services, among others
Commuter Benefit (Transit & Parking) Flexible Spending Accounts
- Allows you to set aside pre-tax dollars for eligible parking and transit expenses
- 2024 monthly contribution limit, Transit: $315/month
- 2024 monthly contribution limit, Parking: $315/month
- Bus, train, regional rail, streetcar, trolley, subway, or ferry
- Vanpool*
- Parking at or near work
- Parking at or near public transportation
After you enroll, you can’t change the amount you contribute for the year, because your election stays in effect during the entire plan year (January 1 through December 31). However, if you have a “Qualified Life Event” you may change the amount of your contribution, but the change must be consistent with the event.
The following “Qualified Life Events” may permit you to change your FSA election outside of open enrollment: a change in your legal marital status; a change in the number of tax dependents; termination or commencement of employment by you, your spouse or dependent; a change in employment status that results in gaining or losing eligibility for health coverage; and, Medicare or Medicaid entitlement for you, your spouse or dependent.
