Tuesday, December 15, 2009
Flex Spending Money: Use it (Soon!) or Lose it
Dec. 31 marks the eve of a new year and is also the deadline for many with medical flexible spending accounts (FSA) to spend funds allocated in 2009 (online.wsj.com Dec. 6).
FSAs are provided by employers and enable workers to set aside pretax dollars for qualifying out-of-pocket medical expenses and purchases. You must use FSA money before the deadline or forfeit the balance. FSA plans vary, so it's important to review what you can use the funds for and confirm the deadline for your plan; some extend 2009 allocations into 2010.
There are several practical ways to use your funds, even at the last minute. Some suggestions from USA Today personal finance writer, Sandra Block (usatoday.com Dec. 1), include ordering an advance supply of prescriptions by mail, getting a flu shot, or buying smoking cessation products. Of course, before you make any purchases or appointments check your plan to make sure these are qualified expenses.
If you are not utilizing a FSA plan and one is offered by your employer, consider enrolling for 2010 to take advantage of the tax savings.
Portions of this article were derived from an article published by Home & Family Finance.