Flexible Spending Accounts
Flexible Spending Accounts (FSA) allows you to set aside pre-tax dollars and/or excess FBP credits (Flex credits) from every paycheck to help pay for qualified expenses that are incurred during the plan year, as long as receipts are submitted by the claims deadline.
The City of San Diego offers two types of FSA accounts for tax savings on eligible expenses:
Flexible Spending Accounts must follow strict IRS rules. It’s important to estimate your annual expenses carefully and know the important deadlines.
|If you want to participate in the flexible spending accounts, you must actively re-enroll each year during open enrollment.|
You can enroll in one or both of the Flexible Spending Accounts during your first 30 days as a newly benefitted eligible employee and during the annual Open Enrollment period. During enrollment, you choose an annual contribution amount and the City will automatically deduct that amount pre-tax in equal parts from each paycheck during the FSA plan year. You can only make a change to your account or enroll mid-year if you have a qualifying life event. If you want to continue to participate, you must re-enroll each year during Open Enrollment.
The IRS sets limits on how much money can be set aside annually in the flexible spending accounts.
|2023 FSA Annual Limits|
|2024 FSA Annual Limits|
The IRS determines which expenses can be reimbursed by an FSA. Review the lists of eligible expenses here:
- Examples of eligible healthcare expenses for DMV FSA
- Examples of eligible dependent care expenses for DCC FSA
Note: medical insurance premiums are not eligible to be reimbursed through the DMV FSA option.
Estimate Expenses Carefully
It is important to estimate FSA expenses carefully and set aside only the amount you think you will need while you are contributing to the account during each plan year. The elections you make are valid for the plan year. Changes are not permitted outside of a qualifying life event as approved by the City of San Diego and in accordance with the IRS rules.
Account Funding and Access
WageWorks is the administrator of the City’s Flexible Spending Accounts. Once you have enrolled in the FSA account during your enrollment period, the City will work with WageWorks to setup your account by the start of the plan year.
|DMV FSA||Funded immediately. You’ll have access to the entire amount on the first day of the plan year.|
|DCC FSA||Account funds are available only as you make contributions. You’ll have access to amounts as they are contributed to the plan via your paycheck deductions throughout the plan year.|
Using your FSA Account and Filing Claims
When you enroll in the FSA for the first time you will receive information on how to establish a log-in with WageWorks and process claims.
There are two ways to submit a receipt for reimbursement:
- Through the WageWorks EZ Receipts® mobile app. Use your mobile device to snap a photo of your receipts and submit them for reimbursement.
- Though your WageWorks account. Log into your account, select the Pay Me Back option, upload a digital image of your receipt, and submit your claim.
To make sure your claims are processed quickly, please make sure that your receipts and documentation include the following five pieces of information:
- Patient's Name: The name of the person who received the service or for whom the item was purchased for. For retail store purchases, this information may be excluded.
- Provider's Name: The provider that delivered the service or where the item was purchased.
- Date of Service: The date on which services were provided or the item was purchased.
- Type of Service: A detailed description of the service provided or item purchased. A bag tag is sufficient for prescriptions.
- Cost: The amount you paid for the service or product and/or the portion that is not reimbursed through your insurance carrier.
Please note that not every claim is approved.
- DMV FSA: You will automatically receive a debit card to use for eligible DMV FSA expenses at any provider or retailer that accepts debit cards. The debit card is an additional convenience option and is not intended to replace the traditional claim process. Some eligible healthcare expenses may not be available through the debit card and will only be eligible through filing a traditional claim.
- DCC FSA: There is no debit card option for the Dependent Care Reimbursement Account.
Important Deadlines and Restrictions
FSA accounts are not savings accounts. You can use the money you set aside only for eligible expenses you have incurred during the plan year while you are contributing to the account and during the additional 2 ½ month grace period (spending period). Claims for reimbursement can be submitted anytime during the plan year, but no later than the claims deadline.
|FSA Plan Year||Spending Period
Dates to incur qualified expenses
Deadline to submit reimbursement claims
|2022 Short Plan Year||July 1, 2022 – March 15, 2023||
October 31, 2023
|2023||January 1, 2023 – March 15, 2024||March 31, 2024|
|2024||January 1, 2024 – March 15, 2025||March 31, 2025|
|Unused FSA funds will be forfeited: If you do not spend the contributions in your account during the FSA plan year spending period and you fail to submit claims for those expenses by the claims deadline, you forfeit any money left in your account. Unused FSA funds do not rollover to the next plan year account. This is an IRS rule and the City of San Diego cannot make exceptions.|
DMV FSA Eligible Health Plan Tax Dependent
Use the DMV FSA to pay for eligible healthcare expenses that are not covered by any medical, dental, or vision coverage. Generally, eligible healthcare expenses may be claimed only for expenses incurred during the period when you are enrolled in a City-sponsored medical plan. You may use a DMV FSA for healthcare expenses of:
- Your spouse and any child you claim as a dependent on your tax return.
- Anyone who is your “health plan tax dependent” as defined by the IRS.
Internal Revenue Service (IRS) rules determine who is an eligible dependent. Under federal tax law, “health plan tax dependent” includes your children (biological, adopted, step and foster) through the end of the year in which they turn age 26. It also includes other covered individuals for whom you can claim an exemption on your federal taxes. In addition, it includes family members – or an unrelated person who lives with you for the entire year – if they receive more than half of their support from you; are a U.S. citizen, resident or national, or a citizen of Mexico or Canada; and are not claimed as a “qualifying child” dependent on anyone else’s tax return. These rules are complex and may require the assistance of your tax advisor.
DCC FSA Eligible Dependents
You can use your account to pay for the eligible dependent expenses of a qualifying child or relative, as defined in Internal Revenue Code Section 152.
Generally speaking, a qualifying child or relative is:
- Children under the age of 13
- Your spouse, adult relative or adult child who is physically or mentally incapable of self-care
For more information on eligible dependents, visit the DCC FSA Help Page.