It is that time of year to heed the mantra – “use it or lose” when it comes to FSA accounts. Too many people forfeit dollars simply because they do not know what is eligible under the plan, or do not understand the rules. FSA’s act a lot like a line of credit. You can spend more than the balance of the account if contributions by the end of the year cover the expenditure. Your employer may allow a $500 carry over, and due to COVID19, that may have increased. It is always best to check with your payroll department to see what your plan stipulates.
If you are uncertain what is covered, the rule of thumb is anything “medical” which the IRS defines as amounts paid for diagnosis, cure, mitigation, treatment or prevention of disease, or for the purpose of affecting any structure or function of the body. In the Vision world that means prescription glasses, prescription sunglasses, prescription / non-prescription reading glasses, contact lenses, routine exams. Also eligible are eyeglass and lens accessories such as microfiber lens cleaning cloths, and lens cases.