Benefits

Question 1

How is FSA taxed and what are the contributions remainder assets treated?

Answer 1

Not income taxed, As well as FICA or FUTA
Max contribution is $3200
Does not apply to employer contributions/flex credits
$640 can remain in the account indefinitely
amount has to be spent 2.5 months after
It’s either a grace period or rolling balance, not both

Question 2

What are some parameters of the Dependent care FSA payment

Answer 2

Reduced the dependent care credit
Both parents must work or one needs to be a student or disabled
Child must be under 13

Question 3

Dependent care for FSA if you got married to a non-worker

Answer 3

The $5000 becomes taxable
If the funds aren’t used then it is still taxed and funds are forfeited

Question 4

FSAs paying cobra and ltc

Answer 4

Cannot because fsas (medical treatment) cannot be used to reimburse employees for premiums paid to ltc and cobra but hsas can

Question 5

FSA coverage period

Answer 5

The end of the plan year, typically 12/31 or when the employee separates from employment

Question 6

FSA advantages

Answer 6

Can use benefits at the beginning of the plan year
If all is used, you don’t owe it back to your employer (not taxable)
Employer has no risk just a small admin fee $4-10
Any unused amount is returned to the employer