FLEXIBLE SPENDING ACCOUNTS

Flexible Spending Accounts

The City offers Flexible Spending Accounts (FSAs), which are Internal Revenue Code (IRC) approved accounts that allow you to pay out-of-pocket health expenses and dependent care expenses without paying taxes, saving you tax dollars. Be careful not to over budget because if you do not use all the funds in these accounts, the IRC forces you to forfeit the unused monies after the grace period, which expires March 15, 2017 for the plan year 2016.

Flexible Spending Accounts A Flexible Spending Accounts (FSA) is an IRS tax-favored account that can be used to pay for dependent daycare and eligible health expenses administered through Ameriflex. The FSA plan year runs from January 1 to December 31. Employees and/or family members that have predictable health care or work-related day care expenses may benefit from participating in an FSA. The City of Miramar offers three types of FSAs:

  • Health Care Reimbursement FSA covers medical, dental, and vision expenses that are not paid by insurance. There is annual maximum amount of $2,700, which is not taxable income to the participant, and can be used to offset the cost of a wide variety of eligible medical expenses that generate out-of-pocket costs. Elected amount is available on the first day coverage is effective.
  • Employees enrolled in the High Deductible Health Plan (HDHP) may not participate in the traditional Health Care Reimbursement FSA. Instead, they may only select the Limited Purpose FSA. This works the same way as the regular FSA except eligible expenses are limited to qualifying dental and vision expenses. Elected amount is available on the first day coverage is effective.
  • The Dependent Care FSA is available to eligible employee for qualified dependent day care expenses that are necessary for employee and legal spouse, if married, to work.
This account allows the participant to set aside up to an annual maximum of $5,000 if single or $2,700 if married and file a joint tax return, for work- related day care expenses. Qualified expenses include day care centers, preschool, and before/after school care for eligible children under the age of 13 and dependent adults. Funds are available as you contribute. Health Spending Account Employees enrolled in the High Deductible Health Plan (HDHP) can contribute to and administer their Health Savings Accounts (HSA) through Payflex. HSAs provide multiple tax benefits:
  • Tax-free deposits
  • Tax-free earnings
  • Tax-free withdrawals
The City fully funds the HDHP deductible, depositing $1,400 annually for employee only coverage and $2,800 annually for dependent coverage. City HSA contributions, for employees who enroll in the plan mid-year, will be pro-rated based on the quarter in which the employee enrolls in the plan. Employees may contribute additional funds. to their HSA.
  • Employees who are enrolled in single coverage may contribute an additional $2,150 annually.
  • Employees who are enrolled in dependent coverage, may contribute an additional $4,300 annually.
  • In addition to the above, employees over age 55 ,who are enrolled in single or dependent coverage, may contribute an additional $1,000 annually to their HSA.