Flex Your Dollars, Love Your Eyes: 6 Things to Know About Flexible Spending Accounts
’Tis the season to be tax-savvy: As the year’s end approaches, it’s time to remember your Flexible Spending Account (FSA) and put it to good use. Call us biased, but we can’t think of a better way to use your FSA than on those beautiful eyes of yours. Here’s a quick, user-friendly guide to Flexible Spending, with an emphasis on using your FSA for glasses and other eye-health essentials. Did you know that Flexible Spending Account covered items include Rx sunglasses, eye exams, and even colored contact lenses? So read up on your FSA—and then go ahead and snag those stylish eyeglasses you’ve been coveting (or even turn your brown eyes blue).
WHAT is a Flexible Spending Account?
Established by the US government, a Flexible Spending Account (FSA) is a tax-free financial account that can be set up through your employer to help pay for out-of-pocket medical and health-related expenses. You can set aside up to $5,000 annually in your FSA, which is deducted incrementally from your paycheck on a pre-tax basis. Typically, FSAs do not roll over into the next calendar year, so it’s “use it or lose it” with these funds.
WHY have FSAs become popular?
The money set aside in your FSA is not subject to payroll taxes, and can potentially help you lower your taxable income by up to $5,000. So every expense you make with it (hello, those Prada spectacles you’ve been eyeing) turns into a sweet tax deduction. In short, an FSA can help lower your tax burden and increase your take-home pay while you set aside money for health-related expenses.
WHO gets to use one?
To use an FSA, you must be an employee of a company that offers it as part of their benefits package. If you are unsure whether or not you’re eligible for an FSA, you can check with your employer or benefits administrator.
WHAT can I buy with my Flexible Spending dollars?
When it comes to vision-related expenses, almost every purchase is eligible. You can use your flex dollars for eye exams, copays, prescription eyeglasses, prescription sunglasses, reading glasses, contact lenses, and everyday purchases such as contact lens solution and cleaners. Even your favorite designer-brand frames are covered, as long as you have an Rx from your eye doctor. WHEN do I need to spend my flex dollars before I lose them?
Since FSAs do not roll over into the next calendar year, many people need to use their funds by December 31. However, the IRS allows employers to offer an optional grace period that lets you use your FSA funds for up to two and a half months after the end of the plan year—typically March 15. Check with your employer or benefits-plan administrator to find the exact date for you.
WHERE can I spend my FSA dollars for eye health?
At your neighborhood Cohen’s, of course! Drop in today to get expert help from a Cohen’s eye doctor or Eyestylist. The staff at Cohen’s is well-versed in the ins and outs of FSAs, and can advise you on how to best spend those beautiful tax-free dollars of yours—on your beautiful eyes. Find a store near you now.