Car Rental: FSA Eligibility

Car rental necessary for transportation to or from a medical related appointment or stay (with the necessary documentation from a physician) is eligible with a flexible spending account (FSA), health savings account (HSA) or a health reimbursement arrangement (HRA). Car rental reimbursement is not eligible with a limited care flexible spending account (LCFSA) or a dependent care flexible spending account (DCFSA).

How is car rental for medical care reimbursed?

While most areas throughout the U.S. have hospitals and medical facilities accessible to local populations, there's a chance that some individuals will need to seek specialists who can perform specific medical procedures or lend their unique experience to render a diagnosis that local medical services may not be able to provide. This can lead to a wealth of extra transportation expenses necessary for the treatment of an illness, and the IRS has recognized this and has made these expenditures eligible for reimbursement through a FSA, HSA and HRA.

These transportation expenses qualify if they are primarily for and essential to medical care. Reimbursable expenses include car/rental car, bus, taxi, train, plane & ferry fees. Ambulatory services, parking and toll fees are also included. These expenses extend not just to the person receiving medical care but also to other individuals. Parents who are required to travel with a child, nurse/caregivers required for treatment, and any other individuals if visits are required for treatment of a mentally ill dependent.

Last but not least, the IRS issues Standard Mileage Rates annually for business, medical and moving purposes. For those who are renting a car for medical purposes, the deductible costs for operating this vehicle are based on the standard mileage rate. For 2016, the reimbursable rate is 19 cents per mile, down 23 cents from 2015. This rate is adjusted for inflation each year, so this rate should be checked each year before the tax deadline to ensure that account holders are fully reimbursed.

What materials do account holders need for car rental reimbursement?

If a car rental will be required for an account holder to seek out medical treatment or services, these eligible transportation costs will need to be submitted to a benefits administrator for reimbursement. While documentation requirements will vary, most claims will require a printout of the car rental invoice, as well as a bill or receipt from the health care provider validating the doctor's visit, at which point most transportation reimbursement claims will be approved.

Eligibility Table

Flexible Spending Account (FSA) Limited Care FSA Dependent Care FSA Health Savings Account (HSA) Health Reimbursement Account (HRA)

Eligible

Eligible with Rx

Eligible with LMN

Not Eligible

 


AZ-PROD-WEB02 11/22/2017 4:34:04 PM