Human Resource Services
Flexible Spending Accounts
A Flexible Spending Account (FSA) is a tax-favored IRS account that can be used to pay for eligible medical expenses not covered by your insurance or for eligible dependent care expenses to ensure your dependents (child or elder) are taken care of while you and your spouse (if married) are working. These funds are set aside from your salary before taxes are deducted, allowing you to pay your eligible expenses tax-free.
Here’s an example of savings for an employee with a FSA compared to an employee without a FSA:
FSA Savings Example*
(With FSA) |
|
(Without FSA) |
$31,000 |
Annual Gross Income |
$31,000 |
| - 5,000 |
FSA Pre-Tax Contributions |
- 0 |
$26,000 |
Taxable Gross Income |
$31,000 |
|
- 5,889 |
Federal, Social Security Taxes |
-7,021 |
$20,111 |
Annual Net Income |
$23,979 |
| - 0 |
Cost of Recurring Expenses |
-5,000 |
$20,111 |
Spendable Income |
$18,979 |
By using an FSA to pay for anticipated recurring expenses, you
convert the money you save in taxes to additional spendable
income. That's a potential annual savings of $1,132!
There are 3 types of Flexible Spending Accounts (FSA) offered by the state: Medical Reimbursement, Dependent Care Reimbursement and a Limited Purpose Medical Reimbursement Account. Employees may enroll within the first 60 days of hire or during the annual open enrollment period. The plan year runs from January 1 to December 31. While funds accumulated in these FSAs do not roll-over each year, your original election (that is, the dollar amount you designated for the plan year) will carry forward from one year to the next unless you change your election amount or cancel the plan during open enrollment.
Below is summary information about the plans. For complete plan details and for comparison purposes, please visit the MyBenefits section of MyFlorida's web site.
Medical Reimbursement
- Expenses reimbursed: medical, dental, vision expenses including co-pays and deductibles
- Contribution Limit: $5,000 (subject to use it or lose it rule)
Limited Purpose Medical Reimbursement
- Expenses reimbursed: dental, vision and some preventive care; medical expenses generally not included
- Contribution Limit: $5,000 (subject to use it or lose it rule)
- This account can be used to cover allowable expenses that are not covered by the Health Savings Account (HSA).
You should only enroll in the limited purpose account if you are also enrolled in the Health Investor Health Plan and HSA.
Dependent Care Reimbursement
- Expenses Reimbursed: dependent care expenses for child or elder care
- Contribution Limit: $5,000 (subject to use it or lose it rule)
Important details about FSA’s
All 3 of the FSAs mentioned above have a grace period that runs from January 1 through March 15 of each calendar year which allows you more time to use up funds contributed to your account for the previous plan year. Expenses that have not been incurred by March 15 each year, the "use-it-or-lose-it" rule will still apply. To obtain reimbursement for expenses incurred for the prior plan year, FSA claims must be submitted by April 15th of each year. Coming in plan year 2011, debit cards will automatically be issued for employees who already have the plan or who are newly enrolled into a Medical Reimbursement Accounts (MRA). Employees may activate their debit card to pay for eligible medical expenses at the time of service or continue submitting claim forms for reimbursement by the annual deadline. Also beginning in 2011, you must have a doctor’s prescription to pay for over-the-counter (OTC) medications using funds from your HSA or to file an MRA claim. In the future if you decide to switch from a medical reimbursement account to an HSA, please consult the People First Service Center or the Benefits office about how the grace period may adversely affect your HSA eligibility.
In addition to the 3 Flexible Spending Accounts mentioned above, the Health Savings Account (HSA) is another tax favored account which is specifically designed to complement the Health Investor Health Plan (HIHP). This plan can also be used pay for eligible medical expenses not covered by your HIHP coverage.
Health Savings Account (HSA)
- Eligible only if enrolled in a Health Investor Health Plan
- Expenses reimbursed: medical expenses including co-pays and deductibles
- UF contributes $500/yr for individual and $1,000/yr for family coverage for full-time staff; part-time staff receive a prorated amount based on FTE
- Employee contributions are not required to receive the employer contributions
- Employees my contribute pre-tax $2,550/yr for individual or $5,150/yr for family coverage in addition to the employer amounts
- Federal rules allow "catch-up" contributions to a HSA - up to an extra $1,000 if you are 55+ or you will turn 55 any time during that year
- Not subject to use it or lose it rule; funds remaining in your account carryover year to year as long as you have money in the account
- In addition to your enrollment in the plan, you must also complete a separate application with Tallahassee State Bank found on the People First or the state’s My Benefits website to establish your debit card account. For accounts that are not properly or timely established, you will receive a refund for any contributions you’ve made and employer contributions will be returned to UF
How to enroll
Choose one of the following ways to enroll:
- Enroll online via the People First (PF) web site.
- Call PF at 1-866-663-4735 to enroll or make a change by phone.
- Mail your form or fax it to PF at 904-828-6092.
- Attend the UF Benefits’ Group Enrollment Session for assistance with completing your online enrollment with People First.
Be sure to retain a record of your transactions.
Reimbursement claim forms are available from:
- People First web site
- myBenefits section of MyFlorida's site
Mail completed forms directly to:
People First Service Center
Flexible Spending Account
P.O. Box 1800
Tallahassee, FL 32302-1800