If you’re enrolled in a qualified high-deductible health plan (HDHP) and have a Health Savings Account (HSA), you can maximize your savings with a WageWorks® HSA-Compatible Flexible Spending Account (FSA). This pre-tax benefit account helps you save on this plan year’s eligible out-of-pocket dental and vision expenses while taking advantage of the long-term savings power of an HSA.
Why enroll in a WageWorks HSA-Compatible FSA?
An HSA-Compatible FSA works with an HSA to maximize your savings. You save on this year’s eligible out-of-pocket dental and vision expenses with an HSA-Compatible FSA while also saving for future healthcare expenses with an HSA.
An HSA-Compatible FSA lets you pay for qualified out-of-pocket dental and vision care expenses on a pre-tax basis. The money you contribute to an HSA-Compatible FSA is not subject to payroll taxes, so you end up paying less in taxes and taking home more of your paycheck.
And once you meet your health insurance plan’s deductible, you may switch to a traditional Healthcare FSA, which offers even more opportunities to save.
Use this calculator to see how much you can save with an HSA-Compatible FSA.
|Your Estimated Tax Savings|
|Without HSA-Compatible FSA||With HSA-Compatible FSA|
|Gross annual pay||$60,000||Gross annual pay||$60,000|
|Annual family coverage HSA contribution||-$6,650||Maximum annual HSA-compatible FSA contribution||-$2,600|
|Adjusted gross pay||=$53,350||Maximum annual family coverage HSA contribution||-$6,650|
|Tax rate (30%)||-$16,005||Adjusted gross pay||=50,750|
|Annual dental/vision care expenses||-$2,600||Tax rate (30%)||-$15,225|
|Final take-home pay||=$34,745||Final take-home pay||=$35,525|
Take home this much more with a Healthcare Account $780
All figures in this table are estimates and based on an annual salary of $60,000 and maximum contribution limits to the benefit account. Your salary, tax rate, healthcare expenses, and tax savings may be different.
An HSA-Compatible FSA is a great way to maximize your savings this year and in the future. But there are rules guiding your participation in this account.
An HSA-Compatible FSA is right for you if:
You can contribute up to a maximum of $2,600* to your HSA-Compatible FSA each year. The IRS sets the annual contribution limits. A different limit may apply to you according to your employer’s plan.
You may convert your HSA-Compatible FSA to a traditional Healthcare FSA after you have met your minimal annual HDHP deductible of $1,300 for individual coverage and $2,600 for family coverage.*
You enroll in or renew your election in your HSA-Compatible FSA through your employer during your Open Enrollment period. Your human resources department or benefits administrator can tell you when employees in your organization can enroll in an HSA-Compatible FSA and help you get started.
An HSA-Compatible FSA is an annual account. As a rule, the money you contribute to your HSA-Compatible FSA must be used within the plan year.
That’s why it’s important to estimate how much you spend on eligible dental and vision care expenses for you and your eligible dependents each year before you decide how much to contribute to your HSA-Compatible FSA.
Use this calculator to estimate your annual eligible expenses and determine an annual HSA-Compatible FSA election amount that’s right for you and your family.
Nervous about enrolling in an HSA-Compatible FSA because you’re afraid of losing money left unspent in your account at the end of your plan year? Don’t be!
While it’s always important to choose your annual election amount carefully (this calculator can help), the “use it or lose it” rule no longer applies to all types of HSA-Compatible FSAs.
What happens to money left unspent in your account at the end of a plan year depends on the type of HSA-Compatible FSA your employer has chosen for its employees. Depending on your employer’s plan, you may:
Check with your employer to find out which type of HSA-Compatible FSA you have:
You should plan on an election amount to your HSA-Compatible FSA that meets your needs for the entire plan year. As a rule, you can’t change your HSA-Compatible FSA election amount during your plan year.
But there are limited circumstances when you can make changes. For example, if you experience what’s called a Qualifying Life Event, like a marriage or a birth, you may change your HSA-Compatible FSA election amount mid-year.
It’s important to note that if you leave your job, any money left unspent in your HSA-Compatible FSA stays with your employer. You can’t take your HSA-Compatible FSA with you if you leave your company. But if you quit or are terminated from your job and you still have money left in your account, you may elect COBRA to continue your HSA-Compatible FSA through the end of your plan year.
It’s also important to note that the money in your HSA is yours to keep, even if you change jobs, switch healthcare plans, or retire. If you lose your job and elect to retain your HDHP under COBRA, you may even pay the COBRA premiums from your HSA.
WageWorks makes saving simple. You decide how much to contribute to your HSA-Compatible FSA, and funds are withdrawn automatically from each paycheck for deposit into your account before taxes are deducted. The total amount you elect to contribute to your HSA-Compatible FSA each year is available on day one of your plan year.
With a variety of convenient payment options, your WageWorks HSA-Compatible FSA makes it easy for you to get reimbursed for many eligible dental and vision care expenses, like copayments for dentist and optometrist visits, orthodontia, and new eyeglasses or contact lenses.
Payment options include:
WageWorks makes it easy to manage your HSA-Compatible FSA. Log into the WageWorks secure web portal to manage all aspects of your WageWorks account:
The WageWorks EZ Receipts® mobile app puts the power of the WageWorks web portal in the palm of your hand. Download this handy app to your mobile device, log in to your account, and check balances, submit claims, view transactions, snap photos of receipts, get account alerts by text or email—all on the go!