Stocking up on aspirin by Wednesday night will do more than blunt a New Year’s Day hangover for many people across the country.
Purchases like that also help employees who hold health Flexible Spending Accounts whittle their balances before 2008 ends and, in many cases, they forfeit their money.
Benefits experts say there are several last-minute ways to use leftover money in these accounts. FSAs give consumers possible tax savings by letting them use money from payroll deductions on certain health-related expenses.
People with accounts that must be used by Dec. 31 have no time to schedule a medical procedure. Even squeezing in an eye exam may prove impossible, so it’s time to start thinking about the small items.
Band-Aids, cough syrup, laxatives and even condoms are all eligible for flex spending dollars.
“Over the counter (medicine) tends to be the best way to use up those dollars at year-end that are just kind of lingering out there so you don’t forfeit them,” said Kelsey Horne, vice president of Dallas-based Taxsaver Plan, which administers FSAs for about 300 large employers.
She said a family of four tends to spend about $200 each year on over-the-counter items that can be reimbursed through an FSA.
Still before you go on a shopping spree, make sure that you’ve submitted all claims for eligible procedures done earlier in the year. Remember to include proper documentation.
Many people know prescription eye glasses are covered, but few realize FSAs also pay for nonprescription reading glasses, said Tracy Watts, a senior health care consultant with the human resources firm Mercer.
Transportation expenses for a medical visit also can be covered. That includes parking fees, a bus ticket or miles traveled in your car.
The Internal Revenue Service fills several pages on its Web site with examples of expenses covered by FSAs. Among the items you’ll find are Braille books and wages paid for nursing services.
But account holders should always check with their employer because a company can limit reimbursable expenses permitted by its plan, Watts said.
People also should avoid wiping out the corner drug store’s Pepto-Bismol supply just to drain their FSA balance. Plan administrators watch for stockpiling, and they may reject claims where they think that happens.