FLEXIBLE SPENDING ACCOUNT

Employees may elect a pre-tax deduction from their paychecks for the reimbursement of qualified medical expenses. The maximum annual deduction is $2,750 for 2020. Lesser amounts may be selected for the deduction.

Qualified expenses are defined in Section 213 of the Internal Revenue Code. Some examples are bills for doctors and dentists, drugs, hospital, clinics, eyeglasses, and physical exams. For a specific example, consider a visit to a hospital emergency room for a severe wound that requires stitches, but no admission to the general hospital. The hospital bills the injured/insured person $250, which is the emergency room deductible under the injured person’s medical insurance. The injured/insured person pays the $250 to the hospital with FSA card. Later the insured person may be requested to submit the bill to HRC.  HRC Total Solutions manages the program.  The plan year will end on May 31st.

Once the submission deadline has passed 90 days past May 31st of the carryover any funds up to $550 remaining in the account will be transferred to the new year and not apply towards the $2500 maximum deduction for that year. Any balance beyond $550 must be forfeited to the employer per IRS directives.

An Exemption was made by the Government due to Covid-19.  For 2020 only, you are allowed to apply medical expenses against the remaining balance until December 2020.

Applications may be obtained from the Payroll Office.

updated August 2020