Page 11 - Leona Arizona Employment Group Flipbook

Flexible Spending Accounts

A Flexible Spending Account (FSA) helps you pay for health care or dependent care costs using tax-free dollars. Your contribution
is deducted from your paycheck on a pretax basis and is put into the FSA. When you incur expenses, you can access the funds in
your account to pay for eligible expenses. This chart shows the eligible expenses for each FSA and how much you can contribute
each year. Each of these options reduces your taxable income.

Account type Eligible expenses Annual contribution limits
Most medical, dental and vision care expenses Maximum contribution is $2,750 per year.
that are not covered by your health plan (such as
Health Care FSA Funds are deducted throughout the year, but all
copays, coinsurance, deductibles, eyeglasses funds are available on January 1.
and prescriptions)
Dependent care expenses (such as day care, Maximum contribution is $5,000 per year
after school programs or eldercare programs) ($2,500 if married and filing separate tax returns).
Dependent Care FSA
for children under age 13 or eldercare so you and
your spouse can work or attend school full-time

Important information about FSAs

Your FSA elections are effective from January 1 through December 31. Claims for reimbursement must be
submitted by March 31 of the following year. Our Health Care FSA allows you to carry over $550 in unused
funds to the following plan year.
Please plan your contributions carefully. Rollover amounts must be used during the following plan year.
Any money in excess of $550 remaining in your account after December 31 will be forfeited. This is known as
the “use it or lose it” rule and it is governed by Internal Revenue Service regulations. Note that FSA elections do
not automatically continue from year to year; you must actively enroll each year.
Annual enrollment for FSA’s takes place in November each year for a January 1st effective date.
Remember to keep copies of your receipts with your tax records!

The Advantages of an FSA
With FSA Without FSA
With an FSA, the money you contribute is never taxed—not
when you put it in the account, not when you are reimbursed Your taxable income $50,000 $50,000
with the funds from the account, and not when you file your Pretax contribution
income tax return at the end of the year. WEX is Leona’s FSA to FSAs $2,000 $0
administrator.
Federal and Social
Once you are a participant, you can view your available balance Security taxes* $11,701 $12,355
and claims information online at www.wexinc.com.
After-tax dollars spent
on eligible expenses $0 $2,000
Save on Your Taxes
Spendable income
At the right is an example of how much you can save when $36,299 $35,645
after expenses
you use the FSAs to pay for your predictable health care and
dependent care expenses. Tax savings with Health Care and Dependent Care FSA: $654
Keep in mind that because FSAs are not subject to FICA, *This is an example only and may not reflect your actual experience. It assumes
your overall Social Security benefits may be slightly reduced. a 25% marginal federal income tax rate and a 7.65% FICA rate. State and local
taxes vary and are not included in this example.

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