Currently, over 35 million workers use Flex Spending Accounts (FSAs) to cover out-of-pocket medical and dental expenses. Patients with FSAs can elect to have an amount withheld (up to $2,500 a year) from their pay on pre-tax (tax-deductible) basis to be used for the payment of eligible medical and dental expenses.
While the elected amount is withheld from the employee-patient’s pay on a prorate basis over the entire calendar year, the employee is free to spend the entire elected amount in a lump sum at any time during the year, even on January 1. This has given rise to the first of the year collections surge.
Recently, the IRS provided added flexibility for patients with FSAs, increasing their attractiveness. In prior years, patients with unused FSA balances near year-end had to “use it or lose it,” forfeiting any unused amounts remaining at yearend. Now, those unused dollars can roll over into the next year, as long as the worker’s employer takes action to modify their plan document.
While that change will make FSAs more attractive, the lower FSA maximum of $2,500 a year will still force patients to pay the remaining fee amount with non-deductible, after-tax dollars.
Take advantage of your flex spending benefits for you or your family’s orthodontic needs. At Barnett Orthodontics of Austin and Round Rock, Texas, we are here to assist you, and we suggest the following: Utilize any FSA funds that are available toward your current balance OR schedule your braces and orthodontics appointment in the New Year to utilize your benefits that are effective January 1, 2016.
This information is not meant as medical advice. It is provided solely for education. Our practice would be pleased to discuss your unique circumstances and needs as they relate to these topics.
Austin & Round Rock, TX, orthodontist Dr. Ronald Barnett of Barnett Orthodontics offers the most advanced braces for children, teens and adults, including clear ceramic braces, metal braces, Invisalign, and Damon braces. With 2 convenient orthodontic offices located in Austin, TX, and Round Rock, TX, there is sure to be an office conveniently located near you. Call us today for a free consultation for braces!