Don’t Waste Your Flexible Spending Account Dollars

A Flexible Spending Account (FSA) allows you to dedicate pre-tax money to eligible health care and out-of-pocket costs for you, your spouse, and your dependents. Employers who offer this benefit will withhold a certain amount of money each paycheck, pre-tax, for your FSA account. The money accumulated in your FSA account must go toward qualified health care expenses throughout the year.

This year is almost over, which means it’s time to check the remaining funds in your FSA account. Any funds not spent by December 31, 2022, will most likely be forfeited. (Your employer may offer a grace period or a carry-over amount, but it’s not required by law.)

You can read more about how FSAs work in this IRS publication. But here are a few fast facts about FSAs from Healthcare.gov:

If you have taken care of your primary annual medical needs and still have money in your account, check this list of Eligible Health Care FSA (HC FSA) Expenses.

What you can buy with your FSA

Many people don’t take advantage of all the approved FSA items and miss out on using up the funds in their accounts. Here are some common and unexpected ideas for spending that money wisely to meet current, upcoming, or unforeseen health needs.

What most people do

Accumulating surplus over-the-counter medication such as allergy treatment, pain relievers, and cold medicine is a typical way to zero your FSA. Some ideas:

Medical Procedures

If your health care plan doesn’t cover eye and dental care, use your FSA account to cover costs for exams or procedures. Many medical procedures are eligible for FSA spending, including:

Exercise and Wellness

FSAs can also pay for certain wellness expenses. A medical practitioner's note or prescription must accompany the expense on submission. For the expense to be eligible, the product or service must treat a specific medical condition for a finite duration. These could include:

Vaccines and COVID-19 Tests

You can often obtain vaccines using your FSA account. Here are some examples of vaccines that are commonly paid for with FSA funds:

Family Planning and Care

Knowing what family care expenses are eligible for FSA spending can be confusing. For example, diaper rash ointment is, but diapers are not. Many services and items, however, are covered, including fertility treatments, contraception, condoms, and pregnancy tests for family planning. Childbirth classes, breastfeeding classes, prenatal vitamins, lactation supplies, and breast pumps are qualified items for pregnant or new moms.

Learning disabilities

You may be able to use FSA funds to pay for learning disabilities testing and developmental services. FSA funds can cover early intervention, therapy, and tools such as braille books.