FLEXIBLE SPENDING ACCOUNTS (FSA)
A Flexible Spending Account (FSA) is an account eligible employees use to put pre-tax money into throughout the year. You choose how much money to contribute to your FSA, within limits, and you choose what qualified expenses to spend your FSA funds on — an FSA is flexible that way.
Healthcare and Dependent Care Flexible Spending Accounts (FSA) allow you to set aside pretax dollars to pay:
- Eligible healthcare expenses - such as co-pays, dental services, prescriptions, glasses, over-the-counter medications (cold/sinus, for example), and more.
- Out-of-pocket child care expenses for dependents under the age of 13.
Looking for Health Savings Account (HSA) information? Find it here.
HOW THE FSA WORKS
Step 1. Decide Your Amount for the Year
- You determine how much you want to set aside pre-tax for medical, dental and vision expenses up to the IRS limit for that year.
- Eligible Expenses Flyer
- Estimate your costs with this calculator.
- Consider Your Deductible - You can use the funds to pay for all or part of a deductible, up to the $2,700 annual contribution limit. You’ll have your deductible budgeted for the year at a tax-free rate.
- Use it or Lose It - The funds you set aside in a year can only be used for qualified expenses incurred during the calendar year 1/1 - 12/31. Funds do not carry over and are lost if not used.
Step 2. The Account is Fully Funded Upfront
- The full amount you choose for the year is deposited into your FSA account upfront.
- Your pre-tax payroll contributions are deposited to the FSA throughout the year, saving money on taxes.
Step 3. Use the Funds All Year
- Since the account is fully funded upfront, you can immediately begin to use the funds at the start of the plan year (or, for new hires, when your plan goes into effect) to pay for eligible medical expenses such as deductibles, doctor visits, prescription drugs, glasses and more.
- Pay at point of service - You will automatically receive a MasterCard debit card to have the convenience of paying right at the doctor’s office or pharmacy. See more below.
FSA Types & Contribution Amounts
There are three types of FSA Accounts. You specify the annual dollar amount of your earnings to be deposited to each account.
- Healthcare FSA - Minimum: $130 / Maximum: $2,700 (2020) | Maximum: $2,750 (2021)
Pays for qualified medical, dental, and vision expenses, including insurance copays and deductibles. EPO and PPO participants only.
- Limited Purpose FSA - Minimum: $130 / Maximum: $2,700 (2020) | Maximum: $2,750 (2021)
Pairs with a health savings account to help you pay for dental and vision expenses. (HSA participants only.)
- Dependent Care FSA - Minimum: $260 / Maximum: $5,000 ($2,500 if married & filing separately)
Pays for the care of a dependent child or adult so that you can work. (IRS regulations may require ADOA to reduce your contribution due to IRS non-discrimination test requirements. The Dependent Care FSA for Highly Compensated Employee contribution is limited to $1,600 in 2020. A Highly Compensated Employee is defined by the IRS as having earned $125,000 or more in 2019.)
ENROLLMENT - EACH YEAR
- During New Hire Enrollment or Open Enrollment. You must re-enroll for the account(s) each year.
- Enrollment can be done on yes.az.gov
FSA MASTERCARD DEBIT CARD
The card has many benefits
- Your debit card will be pre-loaded with the entire amount of the deductions you selected for the plan year - the same card works for Healthcare and Dependent Care FSAs.
- This makes it much more convenient to use your FSA contributions.
- The TASC FSA MasterCard Debit Card is a limited-use benefit card that will allow you to directly pay the merchant or healthcare provider from your health FSA account.
- The card is accepted at healthcare and retail providers that accept MasterCard. At the point-of-sale, simply present your card for payment.
- The card's advantage is that you do not have to pay with cash or a personal credit card.
- The merchant will process the transaction; then the card company will then report the transaction to TASC.
Debit Card AutoMatically Sent
- You will be sent a new debit card automatically upon enrollment and may request additional cards for your dependents. The card is valid until the expiration on the front.
- The card will arrive in a plain white envelope for security reasons, so be sure to watch your mailbox.
SUMMARY PLAN DESCRIPTION
TASC | 833-433-4301 | tasconline.com | For claims after 1/1/2020
University Faculty and Staff: Please see your HR website for your flexible spending account options.
In response to the unprecedented COVID-19 pandemic, we want to advise you of your options to reduce, discontinue or increase contributions to your Dependent Care Flexible Spending Account (FSA).
Please read the full instructions on the steps you can take here.
CHANGES TO THE 2020 FLEXIBLE SPENDING ACCOUNT ADMINISTRATION BY ADDING CARRYOVER PROVISION INSTEAD OF A GRACE PERIOD
On December 18, we informed you of a grace period for your 2020 FSA account that would allow you to use your funds for 2021 expenses. Due to changes enacted in the second federal COVID stimulus bill signed into law on December 27, a carryover provision will now be put in place instead of a grace period. This is good news because it allows you to spend your 2020 funds in 2021 and you will not forfeit your unused 2020 FSA funds. Please read the following information carefully.
Grace Period No Longer Applicable
- We realize that you made plans based on the December 18 grace period notification. When the stimulus bill was made law on December 27, it presented new information that we used to extend the ability to use your 2020 funds during 2021. This required moving from a grace period to a carryover provision.
Filing Deadline for 2020 Expenses
- You have until March 31, 2021 to submit eligible expenses with dates of service that occurred during the 2020 Plan Year of January 1 to December 31, 2020.
- If you have 2020 funds left over after the filing deadline, you will be able to use them for 2021 expenses. Please read the next paragraph for more information.
How You Can Use Your 2020 FSA Funds in 2021
- Since there are a variety of situations for our members, we have developed a convenient chart outlining how the 2020 filing deadline and carryover provision will work. View the chart here.
Your Account Balances
Login to the TASC website or mobile app to view your balances and account activity. To use the mobile app, you must set up your account on the TASC website first, then download the app from your app store.
Submit a Claim
TASC accepts claims via their website, mobile app, fax or mail.
Questions About Tax Issues?
Please consult your tax advisor.