How much do I have left in my FSA?
If you’re one of the up to 38 million Americans who use a flexible spending account (FSA), you know it can save you pre-taxed salary dollars on health and medical expenses, including eye care.
Still, many continue to allow hundreds of dollars to go unused annually from their FSA in large part due to not understanding the types of expenses covered or how to manage their contributions and deductions.
Are you using your FSA to its full potential? Here’s how to keep an eye on your vision care and related expenses and get the most out of this special health-care benefit.
First, determine what’s eligible
Your provider will have a list of FSA-eligible items. And it may surprise you to learn what is and isn’t covered.
For example, eyeglass cleaning kits, eye drops and contact lens cases are covered. However, while over-the-counter (OTC) reading glasses are eligible for reimbursement, OTC sunglasses are not.
FSAs cover a variety of optical purchases, including contact lenses, prescription sunglasses and eyeglass frames in a wide range of brands. Eye exams are also eligible -- even if you don’t have vision insurance.
You can even claim mileage on travel to and from eye doctor appointments and your pharmacy for prescriptions.
How much did you spend last year on prescriptions, copays and optometrist visits? Factor those expenses, as well as any other procedures you anticipate, into your contribution planning. Don’t forget to account for your children and other dependents.
The current maximum account contribution is $2,700 for individuals and $5,000 for dependents. These limits apply to both a full-purpose and a limited-purpose FSA. And, most providers allow for contributions to be automatically deducted from your paycheck.
Swipe your card
Most providers, such as WageWorks and ProBenefits, offer an FSA card that makes it easy to determine at the point of sale whether something is FSA-eligible.
This card will automatically withdraw from your allocated pre-taxed funds. You can swipe it just like a credit card and cash in on planned savings at locations that sell or offer FSA-eligible products and services.
Some third-party providers also allow you to make direct payments to your healthcare provider. The funds are automatically withdrawn from your flexible spending account. No card is needed. Others can arrange for account funds to be directly deposited into your bank account or can send you a check to reimburse you for eligible expenses you've already paid.
Know and check your balance
Knowing how much money you’ve contributed and spent at any given moment will come in handy, especially when you may be using various methods to pay for eligible services and items.
Your FSA provider is the gatekeeper to your flexible spending account and works with your employer to administer your account. But, it is your responsibility to keep track of your account funds. You can access your balance, view transactions, submit or monitor claims for reimbursement and check payment status via your third-party administrator.
Most providers have an online portal you can use to monitor your account balance. WageWorks, for example, allows you to check your balance online, through its mobile app and via text. Or, you can contact your third-party FSA provider at the number on the back of your card or paperwork. If you don’t have access to either, check with your company's human resources department or administrator.
While an FSA card can make purchasing eligible goods and services a breeze, holding on to receipts can help you track where your FSA dollars are going and how much you have left.
Plus, your plan administrator may still request receipts for proof of eligibility and it can help you stay compliant with IRS regulations .
Several providers offer a mobile app that allows you to capture any receipt for an FSA-approved purchase in real time. You just need to access the app, take a photo of the receipt and save it to your account.
Read the fine print
Don’t get caught off guard. Know the flexible spending account rules and apply this to managing your fund balance.
FSAs are a use-it-or-lose-it benefit that expire at the end of the calendar year. While some employers offer a March 15, extension or 10-week grace period into the next year, others may only offer a $500 annual carryover or none at all.
You may be able to change your contribution mid year if you experience a qualifying event such as having a baby, getting married or switching jobs. Check with your HR department or FSA provider for more information.
Remember: This is your hard-earned money. By minding the details, you stand to enjoy the real benefits of choosing an FSA. What are you waiting for? Schedule your annual eye exam today.