Skip to main content
Skip table of contents

What is a Flexible Spending Account (FSA) and how do I use it?

A Healthcare Flexible Spending Account (FSA) is an employer-owned account. You can put pre-tax money into this account to pay for eligible healthcare expenses.
 

This article will teach you about: 


Contribution limits and changes

The 2023 contribution limit is $3050. 

If you’re married and your partner has an FSA with their employer, they can also contribute up to $3050 to their own FSA.

 

There are only two scenarios when you can make changes to your FSA contributions: 

 

  • During your annual open enrollment period

  • If you experience a Qualifying Life Event (QLE) that relates to your FSA funds

     

    Example: You get married and add your partner to your health insurance. There are more people who may need to use your FSA, so you'll be able to add more money to the account (up to the annual contribution limit).


Eligible expenses

The IRS decides what healthcare expenses are eligible. Some examples are:

 

  • Medical, dental, and vision copays, coinsurance, and deductibles

  • Prescription drugs

  • Prescription glasses and contact lenses

  • Insulin

  • Some medical equipment

 

Note: You can’t use FSA funds to pay for insurance premiums.

 


How it works

All your FSA funds are available to use immediately at the beginning of your plan year. This includes funds both you and your employer have contributed.

 

Once you open an FSA, you’ll receive a physical card. You can use this card to pay for eligible expenses the same way you’d use a debit or credit card. If you pay for an eligible expense out-of-pocket (with your own money), you can submit a claim for reimbursement instead.

 

To submit a claim for reimbursement, log in to your FSA administrator portal. Read about how to access your administrator's portal.


Can I use my FSA funds if I leave my employer?

Because your employer owns your FSA, you can’t access these funds if you change or lose your job.

Your employer may offer a run-out period, but this is up to your employer and isn’t required. A run-out period gives you a short amount of time to submit any expenses from when you were still employed. You can’t submit any expenses from after your last day.
 

Can I use my FSA funds after my plan year ends?

Your employer can choose to give you access to unused FSA funds at the end of the plan year, but this isn’t required. If they do, there are limits to what funds you can access.

There are two ways your employer can choose to give you access to your funds:
 

Option one: Rollover

Up to $610 of your FSA funds will carry over into your next plan year. These funds will be available to you on top of the amount you choose to contribute in your next plan year.

 

Example: You contribute $2000 to your FSA in 2022. At the end of the plan year, you still have $700 left. Up to $610 of these remaining funds will rollover into your FSA for the 2023 plan year.

 

Option two: Grace period

You’ll have an extra 2 ½ months to use your FSA funds from the previous plan year.

 

Example: You contribute $1500 to your FSA. At the end of the plan year, you still have $200 left. You’ll have 2 ½ months to use the $200. If you don’t use it after 2 ½ months is over, you’ll lose access to the funds.

 

Note: Your employer can only offer one of these options, not both.

What if my employer doesn’t offer rollover or a grace period?

You’ll lose access to any money left over in your FSA. It’s important to keep this in mind, so you don’t contribute more money than you think you’ll spend within a plan year.

JavaScript errors detected

Please note, these errors can depend on your browser setup.

If this problem persists, please contact our support.