A flexible spending account (FSA) is a way to set aside money from your earnings before taxes are withheld to pay certain out-of-pocket health care expenses and qualifying dependent day care expenses. As you incur health care or dependent day care expenses throughout the plan year, you will be reimbursed with tax-free dollars from your UT FLEX account(s). This reduces the amount you pay in taxes and increases your spendable income. If you are enrolled in HCRA, you also have the added convenience of the UT FLEX Debit Card to pay for eligible expenses at the point of service.
|Health Care Reimbursement Account||Dependent Day Care Reimbursement Account|
|What can be reimbursed?*||Medically necessary health care expenses, including dental and vision related expenses incurred and paid during your period of coverage. Expenses paid by insurance are not eligible for reimbursement.||For children under age 13 or qualified disabled dependents of any age who are claimed as dependents for federal income tax purposes. Dependent day care expenses that are necessary for you and your spouse (if married) to work or attend school full-time, such as child care services in a home, licensed day care, and adult day care.|
|How much can I contribute?||$15 minimum contribution per month. Total contributions cannot exceed $2,500 per plan year per employee for federal income tax filing purposes.||$15 minimum per month up to a maximum of $5,000 per plan year; or up to a maximum of $2,500 per plan year if married filing separate federal income tax returns|
|Administrative Fee (Annual fee/pro-rated for mid-year changes)||$12||$12|
|Debit Card Fee||No fee||N/A; debit card not available for DCRA|
|How do I get reimbursed for eligible expenses?||- Use express claims at utflex.com
- Mail or fax a paper claim
- Pay with a UT FLEX debit card
|- Use express claims at utflex.com
- Mail or fax a paper claim
|When Can I Get Reimbursed?||First day of your enrollment in the plan||As soon as your first contribution is deducted from your pay and put into your account. Reimbursement can be made only up to your available account balance.|
|Last Day to Incur Expenses||November 15 after the end of the plan year||August 31 (Last day of the plan year)|
|Claim Filing Deadline||November 30 after the end of the plan year||November 30 after the end of the plan year|
*A detailed list of eligible and ineligible expenses is available at www.utflex.com .
|With an FSA||Without an FSA|
|Health Care FSA Contribution (pre-tax)||($1,500)||($0)|
|Dependent Care FSA Contribution (pre-tax)||($4,000)||($0)|
|Taxable Income After Contribution Amount||$34,500||$40,000|
|Estimated Taxes Withheld (22.65%)*||($7814)||($9,060)|
|Money Spent After Tax on Health Care and Dependent Day Care Expenses||($0)||($5,476)**|
|Take Home Pay||$26,686||$25,464|
*Based on 7.65% FICA and 15% tax bracket.
**Assuming $24 in administrative fees to use both accounts.
Note: Please be advised that this example is for illustrative purposes only. These projections are only estimates of tax information and should not be assumed to be tax advice. Be sure to consult a tax advisor to determine the appropriate tax advice for your situation.
To qualify as a tax-exempt plan, the UT FLEX flexible spending accounts must comply with all applicable Internal Revenue Service requirements including forfeiture of unreimbursed funds. In other words, these UT FLEX spending account plans are “use it or lose it" plans. Any amounts you do not use throughout the plan year (and during the grace period for health-related expenses) will be forfeited, so it is very important to plan carefully. Review your prior year's expenses to estimate your health care and dependent day care expenses for the upcoming plan year. Be conservative and plan only for predictable expenses.
If you plan to use a combination of the UT FLEX DCRA and the “Credit for Child and Dependent Care Expenses” on your federal income tax return, the amount you deposit in your DCRA will offset dollar-for-dollar the amount of expenses you are eligible to claim as a tax credit on your federal income tax return. You should carefully review the benefits of the federal income tax credit with the benefits of the UT FLEX DCRA. If you are not sure how this may impact you, consult your personal tax advisor before making your elections.
Any amount left in your account after the claims run-out period will be forfeited.
Important: The IRS maximum amounts for contributions to dependent day care accounts and health care accounts are based on a calendar year (January 1 through December 31). Your paycheck contributions are tracked by UT FLEX and your employing institution on a fiscal year (September 1 through August 31) basis. You and, if applicable, your spouse, not UT FLEX or your employing institution, are responsible for making sure that you do not exceed the IRS limits during each calendar year.