There is still time to enroll in a Flexible Spending Account and save money in 2023. FSA enrollments do not continue from one year to the next. If you have a 2022 FSA and want to participate in 2023, you will need to re-enroll.
What is a Flexible Spending Account?
If you are eligible, a Flexible Spending Account (FSA) allows you to put aside a set amount of money from your paychecks before taxes to pay for certain specific health care or dependent care expenses, which lowers your taxable income.
The main advantage of an FSA is the tax savings it offers. It enables you to pay for eligible out-of-pocket expenses with money you set aside from your pay before taxes are taken out. Without an FSA, you would still pay for these expenses, but you would do so using money remaining in your paycheck after taxes are withheld.
Learn more about Flexible Spending Accounts.
Health Care FSA Vs. Dependent Care FSA
You can enroll in one type of FSA or both. U-M offers two kinds:
- The Health Care FSA is used to pay for most out-of-pocket medical, vision, and dental care expenses for you and your eligible dependents. The Health Care FSA annual limit is $2,850 for 2023.
- The Dependent Care FSA is for eligible day care expenses for a dependent child under the age of 13, or elder care for a dependent adult, while you and your spouse work (or if your spouse is a full-time student or disabled).
Enroll in a 2023 FSA
Complete an enrollment form. Your form must be completed by:
- November 30, 2022 to have your Health Care FSA funds available on January 1, 2023.
- December 31, 2022 to have your Health Care FSA funds available on February 1, 2023. You may incur eligible expenses in January, but you will not be able to use your PayFlex debit card or file claims on your 2023 account until after February 1, 2023.
