How to Get Reimbursed From a Flexible Spending Account
Simplify your Flexible Spending Account reimbursement. Learn how to claim funds for qualified healthcare and dependent care expenses.
Simplify your Flexible Spending Account reimbursement. Learn how to claim funds for qualified healthcare and dependent care expenses.
A Flexible Spending Account (FSA) is an employee benefit allowing individuals to set aside pre-tax money from their salary to cover qualified out-of-pocket healthcare or dependent care expenses. This reduces taxable income, potentially leading to significant tax savings. Getting reimbursed from an FSA involves understanding what expenses qualify and how to properly submit claims.
Before seeking reimbursement, understand which expenses qualify for FSA funds and the documentation needed. Federal tax regulations define eligible medical expenses as amounts paid for diagnosis, treatment, or prevention of disease, or for affecting any body function. Common eligible healthcare expenses include doctor visits, prescription medications, dental care, vision care, and certain over-the-counter medications and medical devices. Expenses must be incurred after your FSA’s effective date and before the plan year concludes, though some plans offer a grace period or limited carryover option.
Dependent Care FSAs cover expenses necessary for work or school. Eligible dependent care expenses include costs for childcare for a dependent under age 13, or care for a spouse or dependent physically or mentally incapable of self-care. Examples include daycare, preschool, before- and after-school programs, and summer day camps. The care provider cannot be someone you claim as a dependent for tax purposes or your child under age 19.
Record-keeping is necessary to comply with federal requirements and avoid claim denials. The IRS mandates detailed documentation for all FSA expenses. Acceptable documentation includes itemized receipts, Explanation of Benefits (EOB) statements from insurance providers, or detailed invoices from healthcare or dependent care providers. Documents must show the date of service or purchase, item description, provider name, amount charged, and patient’s or dependent’s name if applicable. Generic credit card receipts, canceled checks, or balance statements do not provide sufficient detail and are not accepted as primary documentation.
After gathering documentation, submit your claim to your FSA administrator. Most administrators offer several methods for claim submission, including an online portal, mobile application, or paper forms. Log into your FSA administrator’s website or app to find instructions and forms.
When completing the claim form, provide information such as claimant details, service dates, expense description, and reimbursement amount. Ensure accuracy and completeness to prevent processing delays. After filling out the form, you will be prompted to attach or upload your supporting documentation, such as itemized receipts or EOBs. Digital submissions allow you to upload scanned images or photos of your receipts directly.
Online portals and mobile apps offer the fastest processing times, allowing for quick uploads of digital documents. Many mobile apps feature a function to photograph receipts directly with your device’s camera, requiring clear, legible images. Alternatively, you may submit claims via fax or mail, requiring you to print the form and physically attach copies of your documentation.
Keep copies of all submitted forms and supporting documents for your records. After submitting your claim, look for a confirmation number or email. This serves as proof of submission and can be used to track your claim’s status.
After submitting your FSA reimbursement claim, the administrator begins processing. Most claims are processed within three to seven business days after receipt and verification. You can monitor the status of your claim through your FSA administrator’s online portal or mobile app. If more information is needed, the administrator will notify you via email or online.
Funds are disbursed through direct deposit, which is the fastest way to receive reimbursement. Setting up direct deposit, if available, expedites fund receipt compared to waiting for a check. Some FSA plans may also offer the option for the administrator to pay your healthcare provider directly, bypassing the need for you to pay out-of-pocket and wait for reimbursement.
Occasionally, a claim may be denied. Common reasons for denial include insufficient or illegible documentation, the expense not meeting federal eligibility criteria, or the service dates falling outside the eligible plan year. If denied, the administrator provides a reason.
You have the right to appeal the decision by providing additional information or further substantiation within a specified timeframe, often 30 to 60 days from the denial notice. Promptly respond to resolve issues and ensure timely reimbursement.
Even after receiving reimbursement, retain copies of all submitted claims and supporting documentation. This safeguards against future inquiries from your FSA administrator or IRS verification requests.