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Are there any fees for the program?
Not to you. The fees for the program are entirely covered by your employer as part of the benefits package you receive. You pay absolutely no fees for your FSA, to WageWorks or your employer.
How does "pre-tax" savings work?
The money that funds your account comes from your paycheck throughout the year, and is taken out before federal income taxes, FICA (Social Security), and state income taxes (in most states) are calculated. Because you never pay taxes on this money, you can see your savings on your paycheck - in the form of reduced tax withholding.
Do I have to report this on my tax returns?
Not for health care expenses. The IRS does not require any reporting for this type of program. However, if you choose the dependent care FSA option, you will need to identify your provider when you file your tax return - just like you would to take the Dependent Care Tax Credit.
What if I use my FSA for an expense that's not eligible?
If you accidentally pay for an ineligible expense with your account, you'll be contacted for more information about the payment. If it is determined to be ineligible, you'll receive options for resolving the expense.
How will I know how much money I have in my account?
You can get up-to-the-minute account information at any time through www.wageworks.com or by calling 877-WageWorks (877-924-3967) Monday through Friday, from 8 a.m. to 8 p.m. Eastern Time. By signing up to use the online account portal at www.wageworks.com and by providing us with your email, you will also be signed up to receive monthly statement notices, which alert you by email when your account statement is ready for viewing online.
Is it true that I have to "use it or lose it?"
The IRS requires that any remaining balance be forfeited at the end of the plan year (or the following grace period, if your employer allows one). Plan carefully to minimize the chance of forfeiting any money: be careful of how much you set aside in the first place, and keep an eye on your account balance as the year goes by.
Why do I now need a prescription to use my account for over-the-counter drugs and medicines?
In early 2010, the Affordable Care Act was passed as part of the health care reform initiative. Included in the law was a new rule that requires a doctor’s prescription for the reimbursement of Over-the-Counter (OTC) drugs and medicines from a health flexible spending or savings account. For more information about the new rule and how it will affect your account please visit the Health Care Reform page on the WageWorks Learning Center.
*No part of this document is tax, financial, or legal advice. You should consult your own advisors regarding your personal situation and whether this is the right program for you.
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