Flexible Spending Accounts (FSA) Overview

Flexible Savings Account (FSA)

A Flexible Spending Account (FSA) gives you an opportunity to save on taxes by paying for eligible health care and dependent day care expenses with pre-tax dollars. There are three types of accounts: Full Purpose Medical FSA, Limited Purpose FSA, and Dependent Care FSA. All accounts are administered by Wex.

 

New employees are eligible to participate in Dependent Care FSA on the first of the month following 60 days of service. Staff are eligible to enroll in the Full Purpose and Limited Purpose Medical FSA during open enrollment at the end of the calendar year.

 

How Flexible Spending Accounts Work

• You decide how much you want to put into an FSA when you enroll.

• Your contributions are automatically deducted from each paycheck on a pre-tax basis, and accumulate in your account(s). 

• You are paid back from your account(s) with the pre-tax dollars you’ve been saving.

  • Take some time to log in to the Wex Consumer Portal and sign up for free direct deposit. This will allow funds to be sent electronically to your checking of savings account.

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How to order a new or replacement Wex Benefits Card.

How to order a new or replacement cared for a spouse or dependent.

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Click here to review some frequently asked questions concerning FSAs.

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Learn more about when Wex benefits card transactions are automatically approved and when you must provide documentation for eligible expenses.

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Tax Advantages

Ordinarily, you pay for  health care and dependent care expenses with after-tax dollars. An FSA allows you to pay for certain expenses with pre-tax dollars. Because the money you save is deducted from your pay before federal and, in most cases, state income taxes, using these accounts lowers your taxable income. That means you pay taxes on a lesser amount of money.

 

Plan Carefully

Because you gain tax advantages when you use these accounts, the IRS puts certain restrictions on how they work. If you do not use all of the money you deposit during the calendar year, the IRS requires that you forfeit the unused balance, with the exception of $610.  Our plan allows a $610 rollover. Any remaining unused contributions cannot be refunded and they cannot be rolled over into the next year.  If you plan carefully, you can take advantage of the tax savings without worrying about leaving a balance in your account.  The below chart provides you with the IRS Contribution Limits for the current year. 

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Should you choose to end your employment with the Credit Union, you have 30 days from your last day of employment to submit claims (for expenses incurred up to your last day of employment) for the remaining balance of your Medical Expense Reimbursement Account.

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*Take the guesswork out of planning your FSA contributions. Utilize the FSA calculator help you crunch the numbers to determine the amount of money to set aside from each paycheck and the amount of savings you’ll get back in return.

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2023 IRS Limits for Full Purpose and Limited Purpose FSA:

• Full purpose Medical FSA: $3,050 annual

• Limited purpose FSA: $3,050 annual

• Dependent care FSA: $5,000 annual

 

The Health Care and Dependent Care FSA are separate. You cannot use your health care account to pay for dependent care expenses, or vice versa. You must keep copies of your receipts for substantiation purposes by Discovery Benefits or in case of an IRS audit of your FSA expenses.

 

The plan year for both FSAs is the calendar year (January 1 – December 31). All expenses must be incurred during the plan year, but you have until March 31 of the following year to submit your claims.

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Download the Participant Guide Or, log into your account for a more on how these pre-tax accounts can help you bring home more of your paycheck.