EMPLOYEE FLEXIBLE SPENDING ACCOUNTS

Why FSAs are a Plus

The Open Enrollment period is the time to enroll or re-enroll in Flexible Spending Accounts. For the FSA plans, those who expect to have between $180 and $5,000 of out-of-pocket expenses in 2010 should consider enrolling.

Advantages of a Health FSA:

A planned approach to paying expenses—You set aside money that you will have to pay anyway in a pre-tax account from which you can draw to pay eligible health expenses for yourself, your legal spouse and those whom you claim as federal tax dependents.
Affordable pre-tax contributions—You contribute an equal portion of the total annual amount of your account by pretax deductions each pay period.
Total account access—You can use the total annual amount you elected any time during the year when you need it.
Tax savings—Because your deductions are taken before taxes, your tax liability is reduced.
Benefit card convenience—You will have a card that you can use for qualified expenses at participating providers’ offices, drug stores and most pharmacies where credit cards are accepted, so you won’t have to pay out-of-pocket or file reimbursement claim forms. (Be sure, however, to always save your receipts in the event of future requests by the FSA vendor or the IRS to verify that the purchase is valid.)

Advantages of the Dependent Care FSA:

A planned approach to paying dependent care expenses—You set aside money that you will have to pay anyway in a pre-tax account from which you can draw to pay eligible dependent care expenses for your children or dependent adult family members.
Affordable pre-tax contributions—You contribute an equal portion of the total annual amount of your account by pretax deductions each pay period.
Tax savings—Because your deductions are taken before taxes, your tax liability is reduced.

Calculate your savings and increased take-home pay: