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Frequently Asked Questions Insurance

Flexible Spending Account

  • FSAFEDS is a Flexible Spending Account (FSA) program for Federal employees.  It is a voluntary tax-favored program that allows employees to pay for eligible out-of-pocket health care and dependent care expenses with pre-tax dollars.  It is an account where participants contribute money from their salary before taxes are withheld, then get reimbursed for their out-of-pocket health care and dependent care expenses.  Rules and regulations are governed by the Internal Revenue Service (IRS).
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  • Prior to October 2013, the IRS required FSA enrollees to forfeit all funds left unclaimed in their flexible spending account at the end of the benefit year, which may include up to a 2-1/2 month grace period if written in the program’s governing plan document.  This is the “use it or lose it” rule.
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  • Yes! While you are not eligible to enroll in a standard Health Care FSA, you do have the option of enrolling in the standard Dependent Care FSA and/or a Limited Expense HCFSA. The Limited Expense HCFSA allows you to set aside money, on a pre-tax basis, to pay for eligible vision and dental expenses. Visit www.FSAFEDS.com for more information.
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  • Yes! While you are not eligible to enroll in a standard Health Care FSA, you do have the option of enrolling in the standard  Dependent Care FSA (DCFSA) and/or a Limited Expense HCFSA. The Limited Expense HCFSA allows you to set aside money, on a pre-tax basis, to pay for eligible vision and dental expenses. Visit www.FSAFEDS.com for more information.
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  • No. The IRS rule on carry over only applies to health care FSAs.  Dependent care FSAs will continue to have a grace period from January 1 to March 15 each year.
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  • On October 2013, the Treasury and the IRS modified the forfeiture (“use-or-lose”) rule for health care flexible spending accounts (FSAs).  FSA programs may now allow their participants to carry over up to $500 of unused health care FSA funds to the next plan year OR allow enrollees up to a 2-1/2 month grace period at the end of the plan year to use the funds in their flexible spending accounts. The IRS rule on carry over only applies to health care FSAs not Dependent care FSAs.

    FSAFEDS offers carry over for its Healthcare FSA and Limited Expense FSAs.  
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  • Yes, orthodontia and braces are eligible expenses for you, your spouse, and your children under age 26 under a health care flexible spending account.
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  • You can submit your claim online by logging into My Account Summary at www.FSAFEDS.com, clicking on My Claims, and selecting Online Claim Submission. You must upload an image of your supporting documentation in .TIF, .JPG, or .PDF format with your claim information.
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  • By law, annuitants (other than reemployed annuitants) cannot participate in any flexible spending account (FSA) programs, including FSAFEDS. FSAs are a way of setting aside pre-tax salary for reimbursement of eligible expenses. Annuitants receive annuities, which are not salary.

    The balances in your Health Care FSA (HCFSA), LEX HCFSA and Dependent Care FSA (DCFSA)  are treated differently if you separate or retire before the end of the calendar year.

    Your HCFSA or LEX HCFSA will terminate as of the date of your separation or retirement. There are no extensions. Any eligible health care expenses incurred prior to the date of separation will still be reimbursed but those incurred after the separation date are not reimbursable, even if you accelerated your allotments.

    Your DCFSA remaining balance can continue to be used to pay for eligible dependent care expenses until your account balance is depleted or the end of the calendar year, whichever comes first.

    Please note, in order to take advantage of the grace period for your DCFSA, you must be actively employed and making allotments through December 31 of the Benefit Period.

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  • The grace period is an additional 2 ½ months (running January 1 through March 15) during which you can incur eligible expenses that can be reimbursed from your prior year’s balance.  The grace period helps participants avoid forfeiting any of the funds deposited in their FSA account.  Dependent care accounts have a grace period every year.  The last grace period for health care accounts is January 1, 2015 through March 15, 2015.  
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