The Internal Revenue Service (IRS) has announced a change to the Healthcare Flexible Spending Account (FSA) carryover rules. This change relaxes the "use it or lose it" rule and allows participating employees to carry over up to $500 in unused funds from one year to the next. MIT will implement the new carryover provision beginning in 2014. This means you will be able to carry over up to $500 of unused funds as of December 31, 2014 into your 2015 FSA.
There will be no impact on Healthcare FSAs for 2013. If you have participated in a Healthcare FSA this year, you will not be able to carry over unused 2013 funds to 2014, but you will still have a "grace period" until March 15, 2014 to spend your 2013 FSA dollars, as long as you submit claims by April 30, 2014. This grace period will not be available under the new rules starting in 2014.
Please note the IRS limit on the amount you can set aside each year has not changed. The maximum for 2014 is $2,500.
You are eligible for an MIT Health Care FSA if you are paid by MIT, are appointed to work at MIT for at least three months, and work at least 50% of the normal full-time work schedule. Learn more about eligibility.
Although your MIT health and dental plans will cover much of your medical costs every year, you will probably have to pay some portion of your medical expenses out of pocket. The MIT Health Care Flexible Spending Account (FSA) is a voluntary account offered by MIT and administered by Crosby Benefit Systems Inc. The MIT Health Care FSA makes it possible for you to set aside money from your pay to cover some of the medical expenses not covered by your health plan. The money you contribute—up to the annual limits set by federal law (minimum $104, maximum $2,500 annually in 2013)—is not taxed as income, and there is no tax or penalty when you use the money for eligible medical or dental expenses.
When you, your spouse, or dependent children pay for an eligible expense, you are reimbursed through your account. You cannot be reimbursed for the expenses of domestic partners.
Members of collective bargaining units
All the plan provisions are subject to the terms of your collective bargaining agreement.
When you make contributions to your MIT Health Care FSA, you receive certain tax benefits on the money you contribute to your account. By setting aside money for these expenses before taxes, you will generally pay less in federal, state and Social Security taxes.
Participation in an MIT Health Care FSA will not affect your salary for the purposes of
Be as accurate as you can in estimating your annual eligible expenses, so that you do not contribute more to your MIT Health Care FSA than you expect to claim for reimbursement. For 2013 FSAs, you automatically lose any unused money left in your account after April 30, 2014. Use the Crosby FSA Calculator tool located on Crosby's website to help you determine how much money you would like to set aside in either account. You may not use this money for any other purpose or transfer the money to any other account.
New for 2014 FSAs: The Internal Revenue Service (IRS) has relaxed the "use it or lose it" rule and allows participating employees to carry over up to $500 in unused funds from one year to the next. This means you will be able to carry over up to $500 of unused funds as of December 31, 2014 into your 2015 FSA.
There will be no impact on Healthcare FSAs for 2013, but you will still have a "grace period" until March 15, 2014 to spend your 2013 FSA dollars, as long as you submit claims by April 30, 2014. This grace period will not be available under the new rules starting in 2014.
Contact Crosby Benefit Systems Inc. if you have questions about what is covered under your MIT Health Care FSA.
Sign up when you begin work at MIT. Use Employee Self Service to sign up for a Health Care FSA within 31 days of your date of hire or appointment—or within 31 days of the date you receive your official Welcome Letter, whichever is later.
Sign up during Open Enrollment. If you do not enroll within this 31-day period, you must wait until the next annual Open Enrollment period, which takes place in the fall. Your account will then take effect on the following January 1.
Enroll as a result of a life event. If you experience a change in your life that has an impact on your benefits, you can enroll outside the Open Enrollment period.
What's the difference between a Medical Practitioner's note and a Prescription for OTC medicines and drugs, and when is each required?
Medical Practitioner (Doctor's) Notes:
Prescription for OTC medicines and Drugs:
OTC medicines and drugs require a physician's prescription to be eligible.
MIT also offers a Dependent Care FSA, which covers expenses paid to care providers while you are at work.