You may use your FSA debit card at locations such as doctor and dentist offices, pharmacies, and vision service providers. The card cannot be used at locations that do not offer services under the Plan, unless the provider has also complied with IRS regulations. Should you attempt to use the card at an ineligible location, the swipe transaction will be denied.
Once you incur an eligible expense, submit a claim form along with the required documentation. If you have a question about a reimbursement, contact Discovery Benefits. Should you need to submit a receipt, you will receive an email or be mailed a receipt notification from Discovery Benefits. You should always retain a receipt for your records.
General Rules and Restrictions
In exchange for the tax advantages that FSAs offer, the IRS has imposed the following rules and restrictions for both Health Care and Dependent Care FSAs:
- Your expenses must be incurred during the 2017 Plan Year.
- Your dollars cannot be transferred from one FSA to another.
- You must “use it or lose it” – any unused funds will be forfeited.
- You cannot participate in Dependent Care FSA and claim a dependent care tax deduction at the same time.
- You cannot change your FSA election in the middle of the Plan Year unless you experience a Qualifying Life Event like marriage, divorce or birth of a child.
While FSA debit cards allow you to pay for services at point of sale, they do not remove the IRS regulations for substantiation. This means that you must always keep receipts and Explanation of Benefits (EOBs) for any debit card charges. Failure to provide proof that an expense was valid can result in your card being turned off and your expense being deemed taxable.
2½ Month Grace Period
- FSA participants have an additional 2½-month grace period of time to incur expenses after the Plan Year end (December 31, 2017).
- If an expense is incurred between 12/31/2017, and March 15, 2018, AND submitted for reimbursement on or before March 31, 2018, any remaining balance in the previous Plan Year that ended December 31, 2017, will be paid out from the claim, even though the service was provided in the NEW Plan Year.
- The 2½-month grace period applies to both the Dependent Care and Health Care FSAs.