Flexible Spending
accounts

What is a Flexible Spending Account (FSA)?

An FSA is a great way to save money on eligible
health and dependent care expenses.

Here’s how an FSA works:

You set aside a set dollar amount every paycheck. That dollar amount is not subject to state or federal income taxes. It goes into an “account” administered by Benefit Strategies. During the year, when you have eligible health care and/or dependent care expenses, you get reimbursed—tax-free—from your account. Your total annual Health Care FSA contribution is available to you immediately. Your Dependent Care FSA contributions are available to you as you contribute them to your account.

Even if you are enrolled in one or both FSAs this year, you must re-enroll if you wish to participate in FY21.

Examples of eligible health care expenses:

  • Doctor’s office visit copays
  • Prescription drug copays
  • Medical deductibles and coinsurance amounts

Examples of eligible dependent care expenses:

  • Payments for adult or child day care

  • Certain before- and after-school expenses

  • Certain summer camp costs

You can enroll in a Health Care FSA for as little as $250 or as much as $2,750/year.

You can enroll in a Dependent Care FSA for as little as $250 and as much as $5,000/year (or $2,500 if married and filing separate
tax returns).

To enroll in an FSA, learn more about Health Care and Dependent Care FSAs and view other eligible expenses, go to benstrat.com/gic-fsa.

Even if you are enrolled in one or both FSAs this year, you must re-enroll if you wish to participate in FY21.

How can an FSA save you money?

With an FSA, you set aside money every paycheck on an income tax-free basis. You use this money during the year to pay for eligible expenses—tax free.

FOR EXAMPLE:

Who is eligible and when do I enroll?

Active state employees who are eligible for GIC benefits may enroll in a Health Care and/or Dependent Care FSA during open enrollment..

New State Employees and Changes in Status: New state employees and employees who experience a qualifying status change during the year may enroll for partial-year benefits. For the Health Care FSA, new hire participation begins at the same time as other GIC benefits. For the Dependent Care FSA, participation begins on the first day of employment.

What else do I need to know?

In exchange for the tax savings these programs offer, the IRS imposes a use-it-or-lose-it rule. This means that you must use all the money in your account by the end of the plan year, or you lose that money, subject to the grace period.

  • 2½-Month Grace Period: If you still have money left in your FSA at the end of the plan year, you have an additional 2½ months to incur eligible claims and submit them for reimbursement. For the 2021 plan year, you have until September 15, 2021 to incur claims and until October 15, 2021 to submit them.
  • Administrative Fee: You pay a $1.00 monthly administrative fee regardless of whether you enroll in one or both FSAs.

KEY FSA DATES

Open Enrollment: April 6 – June 1, 2020

2020 Plan Year

Plan Year:
July 1, 2019 – June 30, 2020

2½ month Grace Period:
July 1, 2020 – September 15, 2020

Claim filing deadline:
October 15, 2020

2021 Plan Year

Plan Year:
July 1, 2020 – June 30, 2021

2½ month Grace Period:
July 1, 2021 – September 15, 2021

Claim filing deadline:
October 15, 2021

FSA Enrollment for the 2021 Plan Year:
April 6 – June 1, 2020

During the GIC’s spring 2020 Annual Enrollment period, you may enroll in one or both FSAs for the plan year of July 1, 2020–June 30, 2021. You must re-enroll every year.

READY TO ENROLL?