Welcome:
The Flex Spending Benefit Plan enables you to set aside money on a pre-tax basis for certain benefits, thereby saving the Federal State, City and FICA (Social Security) taxes on all contributions. The Flexible Spending Plan options are detailed in the flex spending plan summary link on this webpage.
In order to receive the benefits of this Plan, please complete the Election Form on this website and return it to Human Resources as soon as possible. If you have any questions, please feel free to call Joanne Miller, Manager, Flexible Benefits Plans, HUB International, N.E. at (631) 780-3333 Ext. 308 or Phyllis Cox at Ext. 309. Joanne can be contacted at: joanne.miller@hubinternational.com
FREQUENTLY ASKED QUESTIONS ABOUT FSA
Q: WHAT IS AN FSA?
A: An FSA is an account whereby an employee may elect to set aside a portion of his/her salary on a pre-tax basis and be reimbursed for qualified unreimbursed medical expenses.
Q: WILL I EARN INTEREST ON THE MONEY THAT I CONTRIBUTE TO THE FLEXIBLE SPENDING ACCOUNTS?
A: Flexible spending accounts are not interest bearing investments. The advantage to flexible spending accounts is that you can pay your eligible health care and dependent care expenses with pre-tax dollars.
Q: ARE THERE ANY STATES AND LOCAL GOVERNMENTS THAT DO NOT RECOGNIZE BEFORE-TAX CONTRIBUTIONS?
A: The State of New Jersey does not permit any pre-tax contributions under IRC Section 125. The State of Pennsylvania permits pre-tax contributions for items of a medical nature, such as premiums and medical flexible spending accounts, however does not permit pre-tax contributions for dependent care expenses.
Q: WILL I BE ABLE TO SUBMIT EXPENSES I HAD PRIOR TO MY PARTICIPATION IN THE FLEXIBLE SPENDING ACCOUNTS?
A: No, only those expenses incurred during the period of coverage will be considered. Therefore, only incurred expenses after January 1, 2011 are eligible for reimbursement.
Q: WHAT HAPPENS TO FORFEITED MONEY UNDER THE FLEXIBLE SPENDING ACCOUNTS?
A: All deferrals must be used by the end of the plan year. Any unused deferrals will be forfeited. Forfeited money is pooled and used to help pay the administrative costs of the accounts. This complies with the IRS "use it or lose it" rule.
Q: MY SPOUSE AND I ARE BOTH EMPLOYEES OF EDEN II SCHOOL FOR AUTISTIC CHILDREN, INC., CAN WE BOTH ENROLL IN THE FLEXIBLE SPENDING ACCOUNTS?
A: Yes. You may both enroll on an individual basis. You may each contribute up to $500 if employed over one year but less than two years, or $3,000 if employed over two years in the Health Care Account and you are limited to $5,000 on a combined basis for Dependent Care Account contributions. The same rule applies to an employee whose spouse has a similar account (which may be called a "Reimbursement Account" or "FSA") at another company.
Q: WHEN CAN I EXPECT TO SEE THE EFFECT IN MY PAYCHECK?
A: Beginning with your second paycheck in January 2011. 9
Q: WILL I BE REQUIRED TO RE-ENROLL EVERY YEAR?
A: Yes. Enrollments are effective only for one plan year. However, election forms are simplified for easy completion.
Q: IF I INCUR AN EXPENSE THIS YEAR BUT DON'T PAY THE BILL UNTIL NEXT YEAR, DO I CLAIM THE EXPENSE UNDER NEXT YEAR'S FLEXIBLE SPENDING ACCOUNT?
A: IRS regulations require that you claim the expense against the plan year it was incurred. You will also be permitted an additional grace period of 75 days to incur expenses. You will have until March 15, 2012 to incur expenses, you will then have a run out period to March 31, 2012 to submit claims for expenses incurred from January 1, 2011 through March 15, 2012.
Q: WILL THE FLEXIBLE SPENDING ACCOUNTS AFFECT MY FUTURE SOCIAL SECURITY BENEFITS?
A: Your Social Security benefits may be affected if your earnings are below the Social Security wage base ($106,800 in 2011). If your earnings are over the Social Security wage base and your contributions do not drop it below the wage base, you are not affected. In most cases, the tax advantages of the flexible spending accounts outweigh the impact on your Social Security benefits.
Q: WILL A CLAIM FORM BE REQUIRED FOR FILING MY HEALTH CARE ACCOUNT EXPENSES?
A: You will be required to complete the Health Care Account claim form and send it along with the Explanation of Benefits and receipts of your paid expenses.
Q: WHERE CAN I GET THE APPROPRIATE CLAIM FORMS?
A: Human Resources will have the necessary claim forms.
Q: WHO WILL I SEND MY CLAIMS TO FOR PAYMENT?
A: Claims administration will be done by HUB International, N.E., 1393 Veterans Memorial Highway, Suite 210N, Hauppauge, NY 11788, (631) 360-5308 or (631)360-5309. All claims and inquiries should be directed to the attention of Joanne Miller or Phyllis Cox.
Q: IS THERE A MINIMUM CLAIM AMOUNT UNDER THE FLEXIBLE SPENDING ACCOUNTS?
A: No, all claims will be paid in approximately 14 days.
Q: WHAT HAPPENS WHEN I SUBMIT A CLAIM AND MY HEALTH CARE ACCOUNT BALANCE IS LESS THAN THE AMOUNT OF THE CLAIM?
A: For claims against your Health Care Account, you will be reimbursed up to the annual amount you have elected, even if the amount has not yet accumulated in your account.
Q: CAN I USE THIS ACCOUNT TO PAY FOR MY SPOUSE'S DEDUCTIBLE AND
CO-PAYMENTS?
A: Yes. However, you cannot use this account to pay your spouse's insurance premiums through another employer other than Eden II School for Autistic Children, Inc. 10
Q: WHAT EXPENSES ARE CONSIDERED QUALIFYING UNREIMBURSED MEDICAL EXPENSES?
A: See separate list attached in this package.
Q: MAY I CLAIM A TAX DEDUCTION ON MY FEDERAL INCOME TAX RETURN FOR THE MONEY I CONTRIBUTE TO THE HEALTH CARE ACCOUNT?
A: Since you are not taxed on the money you contribute to the account, you may not claim any tax deduction for those same expenses on your Federal Income Taxes. The only health care expenses eligible for a tax deduction are any additional eligible medical expenses that exceed 7.5% of your adjusted gross income.
Q: CAN I ENROLL IN THE FSA ACCOUNT IF I DON'T HAVE MEDICAL COVERAGE?
A: Yes, you can. Medical coverage is not a prerequisite for enrolling in a Health Care Account and Dependent Care Account.
Q: CAN I ENROLL IN THE DEPENDENT CARE ACCOUNT IF MY SPOUSE WORKS PART TIME?
A: Yes, as long as your contribution to the account does not exceed your spouse's earned income.
Q: MAY I USE THE DEPENDENT CARE ACCOUNT TO PAY A CARETAKER FOR MY ELDERLY MOTHER SO THAT I CAN WORK?
A: If your mother lives with you and relies on you for at least 50% of her support, the Dependent Care Account can be used for her day care expenses. However, the care must be day care expenses incurred because you work, not custodial nursing care. Also, if you are married, the care must be necessary because your spouse also works or is a full-time student.
Q: WHAT IF MY DAY CARE PROVIDER DOES NOT WANT TO GIVE ME HIS OR HER SOCIAL SECURITY NUMBER? CAN I STILL USE THE DEPENDENT CARE ACCOUNT?
A: No. IRS restrictions require you to provide the Social Security number of the individual caretaker or the taxpayer identification number of a child care or adult care center. Without this information, you cannot receive reimbursement from the Dependent Care Account.
Q: BOTH MY SPOUSE AND I WORK, BUT MY SPOUSE MAKES ONLY $4,000 A YEAR. DOES THIS AFFECT HOW MUCH WE CAN CONTRIBUTE TO THE DEPENDENT CARE ACCOUNT?
A: Yes it does, because you cannot contribute more than your or your spouse's taxable income, whichever is lower. In your case, your contribution could not exceed $4,000 for that plan year.
Q: ARE DAY CARE CENTER EXPENSES ELIGIBLE FOR REIMBURSEMENT FROM THE DEPENDENT CARE ACCOUNT?
A: Yes, if the day care center has more than six children or adults enrolled and is licensed. 11
Q: IF THE CHILD OR ELDER CARE SERVICES ARE PROVIDED IN MY HOME BY AN
AU PAIR OR NANNY, WILL THE EXPENSES BE REIMBURSABLE UNDER THE DEPENDENT CARE ACCOUNT?
A: Yes. The services may be provided inside or outside your home. You just need to provide the taxpayer identification number and incurred expense receipt from the caretaker in order to be reimbursed. The caretaker cannot be one of your dependents or one of your children under age 19.
Q: ARE BEFORE-SCHOOL AND AFTER-SCHOOL EXPENSES ELIGIBLE UNDER THE DEPENDENT CARE ACCOUNT? WHAT ABOUT SUMMER CAMP OR KINDERGARTEN?
A: Yes. In situations where a child under age 13 receives before-school or after-school care at the school, the employee must separate the total cost of caring for the child (before and after-school care) from the cost of schooling. If this cost is not available separately, it will be prorated based on the number of hours. Summer day camp is reimbursable if it allows you or you and your spouse to work. Kindergarten, however, is not considered an eligible expense.
Q: CAN I BE REIMBURSED FOR DAY CARE EXPENSES THAT I HAVE PAID IN ADVANCE?
A: No, you can only be reimbursed after the service has actually been rendered.
Q: I AM A VOLUNTEER AT A HOSPITAL. MAY I USE THE DEPENDENT CARE ACCOUNT FOR REIMBURSEMENT OF DEPENDENT CARE EXPENSES INCURRED SO I CAN VOLUNTEER?
A: No. The Dependent Care Account can only be used for dependent care expenses incurred so that you or, if you are married, you and your spouse can work.
Q: IS MY CHILD'S SCHOOL TUITION AN ELIGIBLE EXPENSE UNDER THE DEPENDENT CARE ACCOUNT?
A: Only nursery school tuition or non-tuition costs associated with a dependent child's nursery-type facility, operated by a community group or the like, is eligible for reimbursement under the Dependent Care Account.
Q: CAN I USE THE DEPENDENT CARE ACCOUNT TO PAY CHILD SUPPORT?
A: No. According to IRS rules, this account is to pay for the care of your children that are living with you and only when paying for such care enables you, (and not your ex-spouse), to work or go to school full time.
Q: IF MY DEPENDENT'S 13TH BIRTHDAY IS THIS YEAR, MAY I USE THE DEPENDENT CARE ACCOUNT FOR REIMBURSEMENT OF EXPENSES FOR THE ENTIRE YEAR?
A: Only expenses incurred before your dependent reaches age 13 are eligible for reimbursement. So, if your child's birthday is February 1st, you may use your account for reimbursement of day care expenses through January 31st. 12
Q: WHAT HAPPENS WHEN I SUBMIT A CLAIM AND MY DEPENDENT CARE ACCOUNT BALANCE IS LESS THAN THE AMOUNT OF THE CLAIM?
A: You may be reimbursed from your Dependent Care Account only up to the amount that you have contributed. If your claim is for a greater amount, it will be paid gradually as you contribute more money. It will not be necessary to resubmit the claim.
Q: WHAT HAPPENS IF I TERMINATE EMPLOYMENT?
A: If you terminate employment you will have 60 days to submit claims for reimbursement of expenses incurred prior to your termination. Expenses incurred after you terminate are not eligible for reimbursement.
Q: ONCE THE ELECTION IS MADE FOR THESE PLANS, CAN THE PARTICIPANT CHANGE HIS MIND DURING THE YEAR?
A: The elections, once made, are irrevocable for that plan year. New elections are made prior to the beginning of each subsequent plan year. However, certain situations, known as changes in family status can arise during the plan year; such events allow the participant to change an election. These situations include:
Marriage of the participant
Divorce of the participant
Death of a spouse or child of the participant
Birth or adoption of a child (pregnancy does not constitute a change in family status)
Termination of a spouse's employment
Employment of the spouse
You or your spouse taking an unpaid leave of absence
Switching from part-time to full-time employment by participant or spouse, or vice versa
A significant change in my family's health coverage attributable to my spouse's employment
Q: WHAT DO I HAVE TO DO TO ENROLL?
A: On the attached Election Form, complete your name, address, Social Security number. If you wish to participate in the Health Care and/or Dependent Care FSA, check off and indicate on the blank line the amount you wish to contribute for the plan year of 1/1/11 through 12/31/11.
This Q and A, as well as the other hand out pages do not constitute a Summary Plan Description. Please refer to plan documentation for details.
