It’s Beginning to Look at Lot Like………….Enrollment Time!!!!

You thought I was going to say the name of a popular wintertime holiday didn't you? From the looks of the retail stores it seems that may be true, but for many it’s Flexible Spending Account enrollment time.

It’s fast approaching, so before you can cozy up next to the fire with a cup of cocoa and listen to your favorite Bing Crosby or Alvin and the Chipmunks Album, you have to decide what you’re going to incur in medical or dependent care expenses for the New Year.

So how can you predict the future? Last I checked, you can’t, but here are some tips to help you forecast your medical and dependent care expenses:

Dependent Care Expenses: For me this is simple. With a young child at home I know that I will surpass the $5,000 per year IRS maximum allowed amount. It may be a little easier to estimate dependent care expenses since you most likely know exactly what dependent care expenses you’ll have for the upcoming year and it’s really rare to leave money behind in this account. Just remember each employer has different guidelines on the time-frame to submit claims, so check out the fine details for your plan (or just give us a call, we are here).

Health Flexible Spending/Limited Purpose Flexible Spending: This is where being able to predict the future would come in handy. How can you really decide what your medical expenses are going to be? Well we don’t have a crystal ball either, so it’s really just an educated guess. Currently, the IRS maximum pre-tax benefit amount for Health FSA or Limited Purpose FSA for a plan year is $2,500.  Your employer might have a lower maximum benefit amount, so again, check with them for the details or give us a call. Some employers offer a grace period or a carryover to allow participants more options to use up their balances. If your employer doesn’t offer one of these features you need to incur enough expenses during the plan year to cover your election amount. Otherwise, you will lose it. Unused funds are held by your employer and the IRS has strict guidelines on how the money can be spent. Sorry, no lavish parties.

If you currently have money left in your 2014 benefit account, it is still early enough to think about what expenses are coming up for the rest of the year or consider what you might need to incur to spend down your remaining funds. If you need help determining what you can and can’t use your funds on, give us a call at (877) 661-4727.

Hopefully this information has been helpful and hasn't spoiled your upcoming holiday celebrations. 

The Author: April Van Hove, CFC 

Team Lead FSA/HSA Administrator

abgncs.com

avanhove@abg-mn.com