FSAs have a use-it-or-lose-it rule, however, you may carry over up to $550 in unused health care FSA dollars to the next plan year. Learn more below.

 

An FSA makes it easier to save money

PayFlex is the administrator of the Flexible Spending Accounts available to you.The two types of FSAs offered to you are the health care FSA and the dependent care FSA.

  • Health Care FSA This account reimburses you for various eligible health care expenses. These include medical, dental, vision, hearing and prescription drug expenses. You can also use the FSA funds to pay for copays, coinsurance and over-the-counter (OTC) items. Note: You will need a written prescription for OTC drugs and medicines.
  • Dependent Care FSA This account reimburses you for eligible child and adult care expenses. Such expenses include day care, before and after school care, nursery school, preschool and summer day camp.

The benefits of having an FSA

An FSA can help reduce your taxes and increase your take home pay! The money you contribute to an FSA is exempt from federal taxes, as well as most state and payroll taxes.

Getting started is easy

  • First, decide if you want to enroll in a health care and/or dependent care FSA.
  • Then, review your expenses from last year and this year and think about what you expect to spend next year. This will help you decide how much to contribute to a health care or dependent care FSA.
  • Your employer will deduct your pretax contributions from your paycheck (in equal amounts during the year) and deposit into your FSA.

FSA contribution limits

  • For 2020, the annual health care FSA pretax contribution limit is $2,750. If you and your spouse each have a health care FSA, you can each contribute $2,750. Note: NEXCOM's 2020 contribution limit is $2,700. 
  • The dependent care FSA limit is $5,000 per household/family. If you and your spouse each have a dependent care FSA, you are limited to $5,000 between the two of you.

How to use your FSA funds

If you pay for eligible expenses with cash, check or a personal credit card, you can submit an online request for reimbursement. Or you can fill out a paper claim form and fax or mail it to PayFlex. You may also use the PayFlex Card, your account debit card, to pay for your eligible expenses. When you use the card, the funds automatically come out of your FSA. 

Save all of your receipts. If you have an Explanation of Benefits (EOB) from your insurance plan, save that too. When you submit a claim, you’ll need to submit the EOB or receipt.

Dependent Care FSA 'use it or lose it' rule

A Dependent Care FSAs has a 'use it or lose it' rule. All funds in your account must be used by the deadline (determined by your employer) or they will be forfeited. Learn about specifics of the FSA offered by your employer in the documents in the Forms & Resources section to the left. Any funds remaining in your account(s) after that will be forfeited.  — except Health Care FSA carryover funds.  You can roll over up to $500 of unused Health Care FSA funds into the following year.

Health Care FSA Rollover

Due to COVID-19, the IRS now allows you to carry over up to $550 of unused funds into the following year. This is a $50 increase meant to provide additional flexibility. Any amount above $550 will be forfeited. Learn about your employer's specific deadlines and amounts in the FSA Overview for your employer.

Learn more about FSAs

Read the FSA Overview for your employer to learn about all the deadlines, amounts, etc. for your employer.

Visit PayFlex.com and click on Employee Account Login to use the following tools:

  • My Resources: View educational materials, forms and IRS publications.
  • Savings calculator: Estimate your expenses.
  • FAQs: Review frequently asked questions.

Important IRS changes due to COVID-19 

Rollover amount increase
Currently enrolled HCFSA participants may now roll over up to $550 into the next plan year. This is a $50 increase meant to provide participants increased flexibility. 

Newly eligible OTC items 
When paying for eligible items at various locations or online, the purchase is typically “verified as eligible or not” at the point of sale using Inventory Information Approval System (IIAS). Given the new legislation, members should allow time for the debit card system to update. Updating the card system isn’t something PayFlex manages or has control over.

If the PayFlex debit card doesn’t work at time of purchase, members can pay out of pocket, and request reimbursement from their PayFlex account funds.

Learn more about these changes by viewing your NAF's FSA Overview document below. 

 

Forms & Resources

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