Page 11 - University of the South-2022-Benefit Guide REVISED 3.30.22 FSA WAIT PERIOD

MEDICAL & DEPENDENT CARE

SPENDING ACCOUNTS

A Flexible Spending Account (FSA) is a program that helps you pay for
health care and dependent care costs using tax free dollars.

ANNUAL
ACCOUNT TYPE AND
ELIGIBLE EXPENSES CONTRIBUTION BENEFIT
Employees are eligible to participate in the LIMITS
medical care spending account and/or the MEDICAL CARE FSA
dependent care spending account if the Most medical, dental and vision care Saves on eligible
employee is eligible to participate in the expenses that are not covered by your Maximum expenses not
University’s health care plan. covered by
health plan (such as copayments, contribution is
coinsurance, deductibles, eyeglasses $2,850 per year insurance;
reduces your
and doctor-prescribed over the counter
medications) taxable income
Maximum
DEPENDENT CARE FSA contribution is
Dependent care expenses (such as
daycare, after school programs or $5,000 per year Reduces your
($2,500 if
eldercare programs) so you and married and taxable income
your spouse can work or attend filing separate
Important Information school full-time tax returns)
About FSAs
Your FSA elections are effective from
January 1 through December 31. Example
Claims for reimbursement must be Here’s a look at how much you can save when you use an FSA to
pay for your health care and dependent care expenses.
submitted by March 15 of the
following year. Please plan your ACCOUNT TYPE WITH FSA WITHOUT FSA
contributions carefully. Any money
remaining in your account as of Your taxable income $50,000 $50,000
March 31 will be forfeited. This is Pretax contribution to Health Care and $2,000 $0
known as the “use it or lose it” rule Dependent Care FSA
and it is governed by Internal Federal and Social Security taxes* $15,696 $16,350
Revenue Service regulations. After-tax dollars spent on eligible
Note that FSA elections do not expenses $0 $2,000
automatically continue from year Spendable income after expenses and
to year; you must actively enroll taxes $32,304 $31,650
each year.
Tax savings with the Medical and $654 N/A
Dependent Care FSA
*This is an example only; not your actual experience. It assumes a 25% federal income tax rate
marginal rate and a 7.7% FICA marginal rate. State and local taxes vary, and are not included in
this example. However, you will save on any state and local taxes as well.

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