FSAs are a good way!
Consider the advantages of paying for health care expenses like co-pays and prescriptions with tax-free money you contribute to a health care “Flexible Spending Account” (or “FSA”).
How does it work?
Before any taxes are taken out of our paycheck, we can contribute to a medical savings account that can be used for out-of-pocket health care expenses. These contributions reduce our taxable income and, therefore, reduce our income taxes. We save money! The District pays the full cost of administering FSA accounts. Enrollment occurs during the annual benefits open enrollment period. Refer to our Local 99 contract to see if your classification is eligible to participate in LAUSD’s FSA program.
LAUSD offers two different kinds of FSAs:
Health Care FSA
One type of account, the Health Care FSA, can be used for things like:
- doctor visit co-pays
- prescription drugs
- over-the-counter medications
- dental exams, cleanings, and dental work
- vision (prescription eyewear, contact lenses, contact lens cleaners and solutions, vision correction procedures, such as LASIK, PRK, and radial keratotomy)
- mental health care
- physical therapy
- speech therapy
- chiropractic treatment
- acupuncture
- smoking cessation program
- physician-prescribed weight reduction programs to treat a specific disease such as high blood pressure
Annual Contribution
We may set aside up to $5,000 per year per household into the Health Care FSA. Our annual contribution will be divided equally and deducted from our pay over 12 pay periods. The minimum contribution is $10 per pay period.
Reimbursing Yourself
As soon as we have an eligible health care expense, we can file a claim. There’s no need to wait until the money is in our health care FSA. As long as the total claims for the year have not exceeded your annual election, our claim will be processed immediately. There is a “Use it or lose it” rule; any money remaining in your FSA accounts after a 2-1/2-month extension into the next calendar year will be forfeited.
For more details, visit the LAUSD website’s Health Care FSA page.
For a complete guide of eligible and ineligible health care expenses, log on to www.irs.gov to retrieve IRS Publication 502. (Please note that the IRS publication is not a definitive guide to what is reimbursable under the LAUSD FSA.)
Dependent Care FSA
The second type of account is the Dependent Care FSA. Whether we’re single or married, if we pay for day care for our children or other dependents so that we can work, this account is designed with us in mind. If married, however, our spouse must work full-time, go to school full-time for at least 5 months out of the year, or be disabled and unable to care for our dependents. (See the LAUSD website’s Dependent Care FSA page for more details.)
The Dependent Care FSA can be used for things like:
child or adult day care services
a portion of wages for a housekeeper whose duties include caring for a qualified dependent
schooling costs for children not yet in kindergarten
Annual Contribution
We can contribute up to $5,000 per year per household into a Dependent Day Care FSA. Our annual contribution will be divided equally and deducted from our pay over 12 pay periods. The minimum contribution is $10 per pay period.
Reimbursing Yourself
The reimbursement process for the Dependent Day Care FSA works a little differently than the Health Care FSA. As we incur and pay for eligible day care expenses, we may file for reimbursement. However, we can only be reimbursed up to the current account balance. If a request exceeds the account balance, the remaining reimbursement will be paid when additional funds are deposited. There is a “Use it or lose it” rule; any money remaining in your FSA accounts after a 2-1/2-month extension into the next calendar year will be forfeited.
For more details and information on restrictions, visit the LAUSD website’s Dependent Care FSA page.
For a complete guide of eligible and ineligible dependent day care expenses, log onto www.irs.gov and retrieve IRS Publication 503. (Please note that the IRS publication is not a definitive guide to what is reimbursable under the LAUSD FSA.)
