The J M Smith Corporation’s benefit program offers you the opportunity to take advantage of tax savings from two flexible spending accounts. You are eligible to enroll and make changes during open enrollment with an effective date of January 1st, or when you have completed your new hire waiting period.
You can deposit pre-tax dollars in your:
You can deposit up to $3,200 per year in your Health Care Spending Account. You can use the tax-free money in your account to reimburse yourself for:
You can find examples of eligible and ineligible expenses in the list below. For a complete list of eligible expenses, you can download the list of eligible expenses at www.irs.gov.
You can deposit up to $5,000 (or $2,500 if you and your spouse file separate in-come tax returns) in your Dependent Care Spending Account. This account lets you set aside money to pay dependent care expenses that are necessary in order for you (and your spouse, if you’re married) to work or attend school full-time You can find examples of eligible and ineligible expenses in the list below.
Dependent care expenses will qualify for reimbursement if you meet these IRS requirements:
NOTE: If you decide to use the Dependent Care Spending Account, you cannot use the Federal Tax Credit for the same purpose. Consult your tax professional for advice on the most tax-efficient method.
Once you set up your account(s), you can use them to reimburse yourself during the year for any eligible expenses that you need to pay. Here’s how:
Over-the-counter (OTC) drugs and medicines will be considered ineligible expenses unless you have a Note of Medical Necessity (NMN) or a prescription from your physician.
Healthcare debit cards cannot be used to purchase OTC drugs and medicines. If a healthcare debit card is used to pay for these item, the transaction will be denied at the point-of-sale. In this case, you will need to pay for the expense out-of-pocket and submit a claim, along with NMN or prescription, to be reimbursed.
See Eligible and Ineligible Expenses List for more information on this change.
Many providers will accept a Benefit Access Card (like a debit card) to pay for eligible expenses. You present the card at point of sale, and the amount is deducted directly from your account.
If you already have a Benefit Access Card from the previous year, you may continue to use it. It will be linked to your current year account.
If you don’t have a card, complete the Benefit Access Card request from in the forms section, and send it directly to McGriff. There is no charge for the initial card. Replacement cards or additional cards for dependents cost $10, which is deducted from your Flex account.
The only cost is the amount of money you elect to contribute to the plan through payroll deduction.
There are annual maximums that apply to the Reimbursement Accounts:
Medical Reimbursement – $3200 for the Plan Year
Dependent Care Reimbursement – $5000 per Plan Year (if married filing joint tax return);
$2500 per Plan Year (if married filing separate tax return)
You pay no Social Security (FICA), and no federal or state income tax on dollars routed through the plan.
Tax savings are immediate (rather than coming once a year at tax time) since each paycheck reflects lower tax withholding.
Use It, Don’t Lose It!
If you do not file for reimbursement by March 31st, the money you set aside in your account(s) will not transfer to the next year’s account(s). Due to IRS rules, you must forfeit any funds in your spending account(s) that you haven’t used by the end of the year. It is very important for you to estimate your non-covered eligible health and dependent care expenses carefully so you don’t forfeit your contributions.
Your Social Security benefits may be reduced since you will be paying less Social Security taxes.
You can check your account 24 hours a day, 7 days a week. Just log on to the McGriff Insurance Services website and enter your User ID and PIN Number.
There in this form.