How a flexible spending account can affect your tax return
While it's almost April 15, and you may still need to get your taxes done...one item you won't need to worry about is your Flexible Spending Account (FSA). Luckily, youdon't need to worry about your Flexible Spending Account or do anything extra when it comes to taxes and your FSA.
But, do keep in mind the tax savings with your Flexible Spending Account, which you'll be able to enjoy during the year.
Flexible Spending Account Savings
1. An FSA is Tax-Free!
Your exact savings depend on the amount you set aside with your FSA, and what your tax bracket is. Typically, savings are around 40% on money you put in your FSA. Check out our FSA Calculator to estimate how much you could save.
2. Use for Expenses Not Covered By Insurance
An added perk of a Flexible Spending Account is the ability to use this account for medical services which your regular insurance may not cover - including alternative medical providers like chiropractors, acupuncturists, and more.
You can, however, also use your FSA for typical medical expenses like:
- Dental care: Braces, dental cleanings, fillings, bridges, and denture products
- Eye care: prescription eyeglasses, contact lenses, prescription sunglasses, LASIK, eye exams
- Annual physicals
- Cancer screenings, body scans, and lab fees related to medical care.
- Fertility treatment
- Flu shots
- Hearing aids
- Medical fees like co-pays, deductibles and co-insurance. Premiums are not covered by an FSA.
- Counseling for a medical or mental condition
Dependent Care FSA expenses:
- Medical expenses for a disabled dependent are eligible. Under a Dependent Care FSA, expenses for care of a disabled dependent are eligible provided that the care is for a qualifying dependent.Expenses for a disabled person, such as a wheelchair, braille books and magazines, a guide dog and special medical care, are eligible.
Learn about other available expenses via our Eligibility List
3. Use Pre-tax Money for Everyday Products
Many healthcare products you use everyday can also be purchased with your pre-tax FSA. If you wear contact lenses, you can buy these and contact lens solution with your FSA. The items in your first-aid kit are also FSA eligible. Pain relief hot/cold therapy packs to treat sore muscles or other aches are also covered with your account.
Check out our wide selection of products you can buy at FSAstore.com and save!