As this year comes to a close many of us start to reflect on what we have and have not achieved. Oftentimes that means we are looking at our health and our overall well-being. As we look back its important to also look at what resources we used to achieve our goals. One of the most often overlooked resources is a Flexible Spending Account.
A Flexible Spending Account, or FSA, is an employer funded account you can use to pay for qualified health care expenses. The amount your employer contributes is typically a pre-negotiated benefit. The money that is put into the account by your employer is not counted toward your gross income for federal income taxes. The money remains tax-free as long as you use it to pay for qualified health care expenses.
The one downside to these accounts is that whatever money is leftover at the end of the calendar year does not roll over. This usually means you have until December 31 to use those funds, or you will lose them. Your employer may choose to offer one of two options they have available to retain funds after the end of the year. The first option is to provide a grace period of up to two-and-a-half months. The other is to allow you to carry over up to $500 per year to use the following year. Talk with your employer to see if these options are available to you.
Did you know?
You can use your health account funds (HAS, HRA or FSA) at any Sams Club Pharmacy, Optical Center and Hearing Aid Center.*Act now before your benefits expire at the end of the year.
*Specialty departments vary by club.
Qualifies for most FSA Plans
(can usually be purchased with an FSA card)
- Bandages, pads and tape
- Braces & supports
- Contact lens supplies and solutions
- Denture products
- Diabetic supplies
- Diagnostic tests & monitors
- First aid supplies & kits
- Glucose monitors & supplies
- Home safety aids
- Reading glasses
The first step in getting the best use out of your FSA is to figure out what is a qualified health care expense. According to the Internal Revenue Service (IRS), a qualified healthcare expense can be medical or dental expenses. Vision expenses such as exams and contacts may also be covered. FSAs will also cover prescription medicine and insulin.
What many people do not realize is that over-the-counter medicines (OTC) may also count as qualified health care expenses. The catch is that you must get a prescription from your doctor for them. For example, if you were planning to quit smoking using a nicotine patch you could pay for it with your FSA account as long as a prescriber writes you a prescription for it. Some of the other OTC items to consider include: common pain relievers, antacids, probiotics, first aid kits and more. Ask your Sams Club Pharmacist to contact your doctor if you need a prescription.
As you start to plan for the new year, don’t forget to plan the end of this year use up your FSA. That money is yours so you should use it before you lose it.