FLEXIBLE SPENDING ACCOUNTS
Flexible Spending Accounts
The City offers Flexible Spending Accounts (FSAs), which are Internal Revenue Code (IRC) approved accounts that allow you to pay out-of-pocket health expenses and dependent care expenses without paying taxes, saving you tax dollars. Be careful not to over budget because if you do not use all the funds in these accounts, the IRC forces you to forfeit the unused monies after the grace period, which expires March 15, 2017 for the plan year 2016.
Flexible Spending Accounts A Flexible Spending Accounts (FSA) is an IRS tax-favored account that can be used to pay for dependent daycare and eligible health expenses administered through Ameriflex. The FSA plan year runs from January 1 to December 31. Employees and/or family members that have predictable health care or work-related day care expenses may benefit from participating in an FSA. The City of Miramar offers three types of FSAs:
- Health Care Reimbursement FSA covers medical, dental, and vision expenses that are not paid by insurance. There is annual maximum amount of $2,700, which is not taxable income to the participant, and can be used to offset the cost of a wide variety of eligible medical expenses that generate out-of-pocket costs. Elected amount is available on the first day coverage is effective.
- Employees enrolled in the High Deductible Health Plan (HDHP) may not participate in the traditional Health Care Reimbursement FSA. Instead, they may only select the Limited Purpose FSA. This works the same way as the regular FSA except eligible expenses are limited to qualifying dental and vision expenses. Elected amount is available on the first day coverage is effective.
- The Dependent Care FSA is available to eligible employee for qualified dependent day care expenses that are necessary for employee and legal spouse, if married, to work.
- Tax-free deposits
- Tax-free earnings
- Tax-free withdrawals
- Employees who are enrolled in single coverage may contribute an additional $2,150 annually.
- Employees who are enrolled in dependent coverage, may contribute an additional $4,300 annually.
- In addition to the above, employees over age 55 ,who are enrolled in single or dependent coverage, may contribute an additional $1,000 annually to their HSA.