The City offers a Flexible Spending Account (FSA) plan that in 2025 will be administered by Employee Benefits Corporation (EBC). These accounts give employees the benefit of allocating money on a pre-tax basis to reimburse out-of-pocket medical and dependent care expenses. Employees do not need to participate in the City’s health insurance plan in order to participate in the FSA. Also, employees who wish to participate must enroll each plan year as there is no automatic renewal process.
How it Works
Contributions are deducted in equal amounts from each paycheck, pre-tax, throughout the year. Upon enrolling, employees will immediately be able to use their total elected amount to pay for eligible medical expenses but will only be able to use what has been deducted from their paycheck for dependent care expenses. Employees can submit claims for reimbursement online or via mail. A copy of the EOB (Explanation of Benefits) or itemized receipt is necessary to verify expenses and validate reimbursement.
Deadlines
The FSA is a “use it or lose it” policy. All claims for reimbursement must be accrued between January 1st of the plan year and March 15th of the following year. All reimbursements must be submitted by June 13th of the following year.
Medical Expenses
Here are some examples of what people can use their FSA money on:
- Doctor visits (co-pays, deductibles)
- Prescription medications
- Dental care (cleanings, braces)
- Eyeglasses or contact lenses
- Over-the-counter medications (like pain relievers or allergy meds)
- Medical supplies (bandages, crutches)
- Therapy sessions (if prescribed)
A complete list of eligible expenses to provide some general guidance can be provided. Additional information is available from the IRS website.
The maximum election allowed for medical expenses is determined annually by the IRS.
Dependent Care Expenses
Dependent Care FSA allows you to set aside pre-tax dollars to cover eligible expenses for the care of your dependents while you work. This can include costs for daycare, preschool, after-school programs for a dependent child or elder. By using a Dependent Care FSA, you reduce your taxable income, which can help save money on taxes while covering essential care expenses for your loved ones.
Daycare or Preschool: Costs for licensed daycare centers, nursery schools, and preschools for children under the age of 13.
Before and After-School Programs: Fees for care before or after school hours.
Summer Day Camps: Expenses for day camps that provide care while you work (overnight camps are not eligible).
Elder Care: Care for an elderly parent or dependent who cannot care for themselves while you work, as long as they live with you.
The maximum election allowed for dependent care expenses is determined annually by the IRS.