Flexible Spending Accounts

Tax Advantages

Benefits eligible employees at Lesley University have the opportunity to pay for eligible health care and dependent care expenses on a pre-tax basis when enrolled in one or both of the offered flexible spending accounts (FSAs). Two types of FSAs are available to eligible employees:

• Health Care Flexible Spending Accounts
• Dependent Care Flexible Spending Accounts

How Flexible Spending Accounts Work

Plan participants designate an annual amount at the beginning of the plan (calendar) year, up to the Lesley maximum of $3,500 in 2007 for health care expenses and/or $5,000 for dependent care expenses.  The amount designated is divided evenly by the number of pay periods during the year and deducted from employee paychecks over the course of the year on a pre-tax basis. As employees incur qualified health or dependent care expenses, reimbursements for these expenses may occur from the accounts. Employees submit receipts with reimbursement claim forms directly to Lesley's plan administrator, Crosby Benefits Systems (Crosby). After verifying that the expenses are eligible, Crosby will mail a reimbursement check to employee homes.

Contributions to Flexible Spending Accounts

To estimate the amount of money to be put aside in a flexible spending account, project health and/or dental expenses that will not be covered by a health or dental plan and/or eligible dependent care expenses for the upcoming year (for which tax credits will not be claimed). It may be helpful to use the FSA Calculator on the Crosby Web site. After this is done, complete a Crosby enrollment form(s) that is available in the Human Resources office. The total annual amount an employee elects to contribute to a FSA will be deducted from each paycheck in equal installments during the calendar year. Care should be exercised in electing amounts for the accounts since any money not used by the end of the year will be forfeited, per IRS regulations. Monitoring the account(s) closely toward the end of the plan year helps ensure all funds are used.

Automatic Approval for Some Expenses

Crosby Benefits now offers a Flex Debit Card to all Flexible Spending participants. The Flex Debit card is an alternative to paying out of pocket for FSA medical expenses. The Flex Debit Card does not always alleviate the need to substantiate your purchases. Many transactions may be automatically substantiated (and therefore will not require you to submit paperwork) by using the debit card without any further action on your part.

Filing Claims

Employees first pay any amounts owed to health care and dependent care providers. Once an employee pays an eligible expense, the employee files a reimbursement claim using the appropriate Reimbursement Request Form, providing funds are available in the employee's FSA. With a health care FSA, the entire deferred amount is available immediately, however, for a dependent care FSA, reimbursement is only available up to the amount that has accrued in an employee's account. Reimbursement checks are payable directly to employees once Crosby receives a reimbursement claim form with attached documentation of expenses. Many employees choose to submit claims on a monthly basis, though claims may be submitted at any time during the plan year and up to three months following the end of the plan year. Employees will receive an explanation of benefits from Crosby upon reimbursement.

Account Statements

Crosby periodically issues statements showing all deposits and withdrawals, as well as account balances.

Participation and Enrollment

Employees who elect FSAs must enroll within 30 days from their date of hire or during the annual open enrollment period, which occurs in the fall of each year.

Changing or Stopping Your Contribution

Note that changes in the deduction amount of or cancellation are not allowed once enrollment is complete unless a qualifying event occurs that changes an employee's family status during the year. Your human resources representative can help determine whether a circumstance may qualify as a family status change.

Tax advantages of the benefit

Benefits-eligible employees at Lesley University have the opportunity to pay for eligible health care and dependent care expenses on a pre-tax basis.