EMPLOYEE BENEFITS

Flexible Spending Accounts Overview

MIT provides the following Flexible Spending Accounts:

Health Care Flexible Spending Account -- to reimburse you for certain planned health and dental expenses that are not covered by your health or dental plans.

Dependent Care Flexible Spending Account -- to reimburse you for certain planned dependent care expenses incurred while you are at work.

When you enroll, your contributions will be deducted from your pay on a before-tax basis. When you incur eligible expenses, you submit claims to be reimbursed through your Flexible Spending Account. MIT also offers a debit card for the Health Care Flexible Spending Account. (See How to Obtain Reimbursement.)

By setting money aside for these expenses before taxes, you will generally pay less in federal, state, and Social Security taxes.

Saving Money with Flexible Spending Accounts

Your taxable salary is reduced by the amount of your Flexible Spending Account contribution. Flexible Spending Account contributions are not included as taxable income for federal, Social Security or Massachusetts tax purposes. While most states recognize these salary reductions, a few states do not. Consult your tax advisor or local taxing authority to be sure.

The tax advantages of Flexible Spending Accounts vary depending on your taxable salary, tax filing status and the amount of your Flexible Spending Account contribution. However, in many cases, you can reduce your tax liability and increase your spendable income by using a Flexible Spending Account to pay for eligible expenses that you would otherwise pay for with your after-tax income.

These accounts should be used only for predictable expenses; under Internal Revenue Code (IRC) regulations, unused account balances must be forfeited.

MIT expects to continue the Plan as a benefit to employees, but reserves the right to change or terminate the Plan should this become necessary or advisable.