A flexible spending account offered through your employer, and administered by your payroll service, is a great fringe benefit that lets you pay medical and child-care expenses with pre-tax dollars.
Make sure you take full advantage of it when deciding how much to contribute — because the amount you can set aside for health-care expenses is now limited to $2,500, a rule change from the health-care law that took effect in 2013.
Another big change now permits some employers to allow employees to carry over $500 from one year to the next, although not all plans have made this change.
Here are 5 suggestions for using up your balance of available funds:
- Prescription eyeglasses – use the pre-tax dollars from you FSA to cover the cost of quality frames, even if you don’t have a vision plan with your employer.
- Orthodontics – flex plans can be used to cover the cost of braces for yourself or your kids.
- Weight-loss programs – if prescribed by a doctor to treat obesity, the cost of this program can be reimbursed through your FSA.
- Lasik and laser eye surgery
- Also remember that the cost of all prescribed drugs can be reimbursed through your FSA.