Flexible Spending Account
Flexible Spending Account
Flexible Spending Accounts (FSA) allow you to set aside pre-tax dollars to pay for eligible health care and dependent care expenses that may not be covered by insurance. Bristol Health offers three types of FSAs that can help you save on a pre-tax basis for out-of-pocket expenses.
The plans provide a significant tax break because you pay for these expenses with your pre-tax dollars, as opposed to paying for them with money that has already been taxed. The money you deposit is exempt from both Federal Income and Social Security Tax. Your deposit is deducted from your salary each pay before taxes are calculated, so you pay taxes on a reduced amount.
Health Care FSA
The Health Care FSA lets you set aside up to $2,750 per year to pay for medical expenses that are not covered by your health, vision or dental plans, including deductibles, copays, coinsurance, and so on.
You have access to the money you elect to contribute on day one. For example, if you have a large expense early in the year and you want to use the full amount you’ve elected to contribute for the year (even before that money is in your account), you can.
If you are contributing to an HSA through Bristol Health or through your spouse’s plan, you are not eligible to participate in the Health Care FSA.
Dependent Care FSA
The Dependent Care FSA lets you set aside money on a pre-tax basis to pay eligible out-of-pocket day-care expenses so that you or your spouse can work or attend school full-time. During open enrollment, you must decide how much to set aside in your dependent care FSA. In 2021, you can contribute up to $5,000, or up to $2,500 if you are married and file separate tax returns. At the end of the plan year, any unused dependent care FSA funds are forfeited.
Limited Purpose FSA
If you are enrolled in the HDHP Plan with an HSA, you are still eligible to enroll in a limited purpose FSA. The limited purpose FSA can be used to reimburse you for dental and vision expenses. You can also be reimbursed for medical expenses once you meet the deductible for the HDHP You can set aside up to $2,750 per year in a limited purpose FSA.
How Do I Get Reimbursed?
Estimate your expenses for the coming plan year. Identify an annual election that you are comfortable with. This amount will be divided evenly over your payroll during the course of the year on a pre-tax basis and contributed to your health care and or dependent care accounts. When you have expenses to be reimbursed, simply submit a completed reimbursement form via mail, fax or directly online at gdynamic.com indicating that the expense has been incurred during the plan year, along with an itemized receipt or a bill from the provider showing your responsibility.
Enrollment Considerations
- You should submit your claims on a regular basis. Eligible expenses must be incurred between January 1, 2021 and March 15, 2022.
- If you do not use all of the funds in your account, you will lose these funds.
- Expenses paid through the reimbursement account cannot be claimed as tax deductions or tax credits.
- You MUST re-enroll in the FSA each year and you, or your spouse, cannot be contributing to an HSA.
Your Debit Card
A debit card will be issued to simplify reimbursement processing for Health Care accounts, allowing you access to your FSA pre-tax deductions. When you incur an eligible health care expense, you may choose to utilize your debit card rather than paying out of pocket and waiting for reimbursement.
Save Your Receipts!
Please be sure to retain all proper documentation for verification purposes. Proper documentation would include your Explanation of Benefits (EOB), a detailed invoice from your provider showing your responsibility or and itemized receipt from a merchant. Canceled checks or credit card statements are not considered proper receipts.
Enroll through Paycom then create your account:
- After the first of the year, and your enrollment information has been received at Group Dynamic, go to gdynamic.com click on “Participant Login” at the top left side of the screen.
- Enter your Username and Password, or click on New User to create your Username and Password
- Use the GDI Portal to:
- Upload receipts and track expenses
- View account activity, balances and claim history
- Set text message alerts for claim and payment alerts
- Download the GDI Mobile app, from the message center in the middle of the homepage
Health Care FSA vs. Dependent Care FSA
To help you understand the differences between the Health Care FSA and the Dependent Care FSA, please review the chart below.
How Can I Save With a Health Care FSA?
In this example you would have saved $440 if you put the $2,750 that you were going to spend anyway in the Health Care FSA program.
How Can I Save With a Dependent Care FSA?
Paige, who is married, contributes $5,000 to a Dependent Care FSA and uses that money towards child day care expenses throughout the year.
Note: Based on estimated tax tables for a married taxpayer filing jointly; your tax savings will likely vary.