A flexible spending account (FSA) is an account you set up with money you contribute from your paycheck before taxes are taken out. Then, when you have an eligible expense, you can pay for it out of your account. So you save on taxes when you contribute to an FSA.
You can choose from two types of FSAs, or decide not to contribute to an FSA:
- Health Care FSA:* Contribute up to $3,050.
- Dependent (Day) Care FSA:* Contribute up to $5,000 (or $3,750 if you are considered a Highly Compensated Employee).
* Benefit Bucks applied toward your Health Care FSA (including Limited Use Health Care FSA) and/or Dependent (Day) Care FSA will apply toward your maximum contribution limit.
Use your pre-tax health care FSA for eligible expenses — such as health-related expenses not covered by your medical, dental or vision plan — for you and your eligible dependents. You cannot use funds in your Health Care FSA to reimburse yourself for dependent day care expenses, or vice versa.
While you contribute to the health care FSA each pay period, your full annual health care FSA contribution is available to you at the start of the year.
Limited Use FSA and the HSA
If you are enrolled in a Schneider Electric CHDP + HSA option, your health care FSA is considered a “Limited Use” Health Care FSA, and you can only use it on certain expenses, such as dental and vision care. You can only use it on eligible medical expenses after you meet your annual medical deductible.
There are two ways to access the money in your Health Care FSA:
- You may use a debit card issued by PayFlex to pay for your eligible health care expenses from your account at the time you have the expense.
- You can also pay for the expense out of your pocket and then file a claim for reimbursement from your account through payflex.com or the PayFlex mobile app.
You can use your Dependent (Day) Care FSA to pay using pre-tax dollars for the cost of child care (for children under the age of 13) or elder care that allow you and/or your spouse, if applicable, to work full time. You can also use this FSA if your spouse is a full-time student or incapable of self-care. You cannot use the account to pay for dependent health care expenses or expenses incurred solely for your personal enjoyment, convenience or ease.
You pay your expenses as needed throughout the year, and then file claims for reimbursement through PayFlex. Your contributions to the Dependent (Day) Care FSA are available for use as they are deposited from your paycheck throughout the year.
Comparing the HSA and FSAs1
|Health Savings Account||Health Care FSA4, 5||Limited Use Health Care FSA||Dependent (Day) Care FSA|
|Eligible expenses||Health care expenses, including copayments, prescriptions, dental and vision expenses||Health care expenses, including copayments, prescriptions, dental and vision expenses||“Limited” health care expenses, such as dental and vision expenses; medical expenses only after you meet the deductible||Day care services for your children and adult dependents|
|Deadline for using the money||None, balance carries over each year||
|Maximum employee contribution amount2||
|Applicable medical plans||
- You must enroll or re-enroll in an HSA and/or FSA each year in order to participate.
- Any Benefit Bucks applied will apply toward this maximum.
- If you turn age 55 by December 31, 2024, you can contribute an additional $1,000.
- You do not need to be enrolled in a Schneider Electric medical, dental or vision plan to be enrolled in the Health Care FSA.
- If you are in the Buy-up CDHP with no HSA, you can participate in the Health Care FSA.
- If you are married and file a separate income tax return, you may only contribute up to $2,500 a year. If you are married and file jointly, and your spouse’s employer offers a Dependent (Day) Care FSA, you can contribute a combined total of $5,000. Highly Compensated Employees (HCEs), as determined annually by the IRS, may be subject to a reduced Dependent Care (Day) FSA annual election amount.