FSA Frequently Asked Questions

Flexible Spending Accounts (FSAs) are part of an IRS regulated, employer-sponsored benefit plan that allows participants to voluntarily convert part of their compensation into tax-free benefits. Contributions made through FSAs are normally free of federal, state and social security taxes.

 

Frequently Asked Questions

 

Dependent Daycare Questions

 

How will I benefit from using a Flexible Spending Account?

With a Flexible Spending Account, you pay for eligible healthcare and dependent daycare expenses with tax-free dollars. You won’t have to pay federal, social security or most states’ taxes on the money you put into the plan. The more you use your plan, the more money you save. Your exact savings will depend on your personal tax rate.

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How does the plan work?

You select the amount that you would like to put into your healthcare account based on your needs for the coming plan year. Chard Snyder and your employer will let you know the maximum allowed amount. Tax-free money from your paycheck will then be added to your account. You may use your BennyTM pre-paid benefit card if your plan allows or pay for eligible healthcare expenses and then submit a claim for reimbursement.

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How do I enroll?
Eligible employees will either enroll online or complete and turn in an enrollment form during the open enrollment period prior to the beginning of each plan year. During enrollment you will elect the amounts that you would like to contribute to your healthcare and dependent daycare accounts. 

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Can I change the amount I am contributing during the plan year?
You can only change contribution amounts if you experience a qualified change of status as defined by the IRS and outlined in the plan's Summary Plan Description (SPD). Please see your Human Resources Department for a copy of the SPD and to submit a qualified change of status request to change your election.

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How do I receive reimbursements?

You can fax, email or mail claim forms and supporting documentation to Chard Snyder or you can submit your claim online through the participant portal. Supporting documentation can be a receipt, a bill, an explanation of benefits summary or any documentation that provides the date of service, the type of service, the service provider’s name and the amount. After the claim has been reviewed and the expense approved, payment is then issued to you via direct deposit or check. Most reimbursement checks are received within two weeks depending on your plan’s payment option. Click here for complete instructions for submitting an FSA claim.

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What is an eligible expense?
An eligible expense is any healthcare or dependent daycare expense approved by the IRS for reimbursement through the plan. These eligible expenses are often the same expenses allowed for income tax return deductions. Please note that expenses reimbursed through a Flexible Spending Account cannot be itemized and resubmitted through an income tax return and you may not use your debit card or be reimbursed for expenses that occurred before the beginning of the Flexible Spending Account plan year. Eligible expenses include items and services incurred by the participant, their spouse and any eligible dependents. You may not use your Flexible Spending Account for pre-payment of services. Please click on one of the following links to view a list of eligible expenses for each type of Flexible Spending Account:

You may access the complete and up-to-date list of eligible items in the EBIA Healthcare Expenses Table by logging in to your account through the My Account Login button above and looking under the Resources tab.

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What happens to funds at the end of the plan year?
Any unused amounts left in the accounts at the end of the plan year cannot be carried over into the next plan year. Most plans allow you to continue to submit claims for purchases and services that you have already incurred. This period of time is called the runout period. After the runout period is over, any funds remaining are forfeited and are not available for reimbursement. Please see your Summary Plan Description (SPD) or contact your Human Resources Department or Chard Snyder if you have questions about the details of your plan.

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Do I enroll each plan year?
Yes. The amounts that you have elected to contribute are for the duration of the plan year in which they are made. New enrollment forms must be turned in and new elections made each plan year.

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What happens if I become ineligible for the plan?

Before the end of your plan year you should use up the money that was in your account at the time of the change. You may not continue to add money to the account. 

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What if I quit or lose my job?

Check with Chard Snyder to find out the requirements of your plan. Use one of the following methods:

You may submit claims for daycare expenses from before the date you left your job.

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If I forget to submit a claim what happens?

You must submit your claims within the time allowed by the plan. Chard Snyder will be glad to tell you your deadline. If you have money left in your plan after this time period, it will not be carried over into the new plan year and no further claims will be paid from the leftover money.

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How is the plan regulated?
In addition to regulations brought forth from Section 125 of the Internal Revenue Code, Flexible Spending Accounts are also regulated in part or in whole by the following entities and legislation:

Please contact our office with any questions about plan regulations.

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Who do I contact for more information?
If you require any assistance with your Flexible Spending Account, then please contact us.

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Dependent Daycare Questions

Which dependents are eligible?

Your natural, adopted and foster children who have not reached their 13th birthday and family members who cannot care for themselves are eligible. All dependents must live with you for more than half the year and be claimed on your federal tax return.

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Is there a special rule for divorced parents?

Yes. The parent designated as the custodial parent may use the dependent daycare plan even if the other parent claims the child as a tax dependent. If the dependent lives with both parents for the same amount of time per year, the parent with the highest adjusted gross income may use the plan.

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How much may I put in the dependent daycare account?

The most a household may set aside is $5,000 a calendar year. Married couples filing separate tax returns may each set aside up to $2,500 each calendar year.

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What are the IRS rules about changes?

The IRS says that you may change the amount you put into the plan in the following cases:

Your Human Resources office will need to approve any changes to your plan.

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May I pay my teenager or spouse to watch my younger child?

No. Your babysitter may not be your spouse or your tax dependent under the age of 19.

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How will I be repaid for my expenses?

You can submit a claim form and receive a check or direct deposit payment. If your plan allows, you may use the Benny™ prepaid benefit card.

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When should I submit my claim?

You may submit your claim at any time during your plan year. Your claim will be paid after the care has been provided. For example, if you pay on the first of the month in which care is to be provided, you may submit a claim each week, every two weeks or at the end of the month and you will be reimbursed for the care your dependent has received.

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Is there a limit to how much I can ask for?

You may only receive the amount of money that is in your account when you submit your claim. If for example, you submit a claim for $200 and you have a balance of $160, you will receive payment of $160. The remaining $40 will be sent when more money is added to your account.

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What happens if I become ineligible for the plan?

Before the end of your plan year you should use up the money that was in your account at the time of the change. You may not continue to add money to the account. 

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