Eligible Dependents

Whose Health Care Expenses are Eligible?

Per the IRS rules effective 1/1/2005.

You can use your Health Care FSA or HSA to pay for health-related expenses incurred by any of the following people - even if they are not covered by your employer's health plan:

  • Yourself
  • Your spouse
  • Your qualifying child*
  • Your qualifying relative*
* Special rules allow a dependent to be eligible for this plan even when that dependent does not qualify to be claimed as your tax dependent on your tax return form. See the definitions below.

A qualifying child.
  • Is any of the following: your child, grandchild, stepchild, foster child or adopted child; brother, half-brother or stepbrother; sister, half-sister or stepsister; nephew or niece; or the child or grandchild of any of the relatives listed above
  • Will reside with you for more than half the calendar year

    • Disregard temporary absences due to illness, education, business, vacation, or military service. You must maintain a home for the child during the temporary absence and the child must be expected to return after the absence.
  • As of the last day of the year, will be under the age of 19; or under the age of 24 and a full-time student. Or, is permanently and totally disabled

    • Full-time student means the child is enrolled at a level the school considers to be full-time for at least five months during the calendar year.
  • Will provide no more than 50% of his/her own support for the calendar year
  • Is a citizen, national or resident of the US; or a resident of Canada or Mexico (unless the child is adopted)
A qualifying relative.
  • Is any of the following: your child, grandchild, stepchild, foster child or adopted child; brother, half-brother or stepbrother; sister, half-sister or stepsister; nephew or niece; the child or grandchild of any of the relatives listed above; your father, grandfather or stepfather; mother, grandmother or stepmother; uncle or aunt; or son-, daughter-, father-, mother-, brother- or sister-in-law. Or, any other person who will reside with you for the entire year (while not in violation of local law).
  • Will not be claimed by any other person as a qualifying child for the calendar year
  • Is a citizen, national or resident of the US; or a resident of Canada or Mexico (unless the person is an adopted child)
  • And, you will provide more than 50% of this person's support for the calendar year

Special Circumstances
Divorced or separated parents: Check with your legal or tax advisor to see if special rules apply to you that would enable your child to be claimed by the non-custodial parent or by both parents.

Tie-breaker: If two or more people want to claim the same child as their qualifying child, the person who has the right to is: (1) the child's parent - if one person is the child's parent and the other is not, (2) the parent with whom the child lives with longest in the year - if both people are the child's parents, (3) the parent with the higher adjusted gross income - if both people are the child's parents and the child lives equally with both during the year, or (4) the person with the higher adjusted gross income - if both people are not the child's parents.


Eligible Expenses
A person is a qualifying child or a qualifying relative for an entire calendar year. You can use your Health Care Account to pay for eligible health care products and services used by your qualifying child or relative during your coverage period - provided the expenses are used during the calendar year in which the dependent is considered your qualifying child or relative.

Example: Your employer's plan year runs from 7/1/2006 to 6/30/2007 and you will be covered for the entire plan year. Your daughter is a qualifying child in 2006, but is not a qualifying child or relative in 2007. The health care products and services your daughter uses between 7/1/2006 and 12/31/2006 are eligible to be paid from your account. The health care products and services your daughter uses between 1/1/2007 and 6/30/2007 are not eligible because she is not a qualifying child or relative at the time she uses the services.