Just a friendly reminder if you’re one of the millions of Americans who uses a flexible spending account (FSA) to help pay for your annual healthcare expenses. We’re halfway through the calendar year, so if you haven’t been using your FSA to help pay for your healthcare expenses so far this year, now is the time to start taking advantage of that tax-free money!
Remember: If you start an FSA, money will be taken from your paycheck before taxes and put into an account for you to use for healthcare-related expenses throughout the calendar year, so it’s a great way to set aside before tax money to use for your healthcare. But it is very important to note that FSAs have a “use it or lose it” feature. If you don’t use all of your FSA money during the year, you will forfeit whatever money is left over. And let’s face it, none of us want to give up money that we’ve worked hard for.
With only three months to go in the calendar year, now is a good time to check on your FSA and see how much money is still in your account. Unless you’re saving up your FSA money to use on one or two major healthcare expenses in the next month or two like elective surgery, major dental work or braces for your children, if you haven’t started using your FSA money, now is the time to start thinking about what you’re going to use it on.
In addition to obvious healthcare expenses like check-ups, dental cleanings, vision care (eyeglasses, contact lenses, etc), check with your plan to find out what expenses are eligible to use your FSA tax-free money for. In addition, over-the-counter medications like aspirin and saline solution for contact lenses are still eligible for FSA reimbursement this year. (Over-the-counter medications will no longer be an eligible FSA expense without a doctor’s note starting on January 1, 2011). To help you keep track of your FSA-eligible healthcare expenses, some pharmacies like CVS will print you out a receipt showing which of your purchases are FSA-eligible.
Have you started using your FSA money? Tell us about it!