It’s open enrollment time
It’s open enrollment time where I work, which means that it’s time for me to sit down and figure out how much I want to put into the flexible spending account offered by my employer. According to the IRS’s Publication 929, there are quite a few advantages to these flexible spending arrangements, and I want to be sure to take advantage of them this year for two reasons: one, it’s highly unlikely that I’d be able to deduct medical expenses on my taxes (in fact I certainly hope that I can’t) and two, I like spending pre-tax dollars instead of post-tax ones. It saves me money.
The way flexible spending accounts work is that you figure up the total amount you are likely to spend on qualified medical expenses during the year and your employer will withdraw that amount (divided up equally over the entire year) from your paycheck. You then submit your expenses for reimbursement. You can also usually use them to pay child-care expenses, depending on the type of account.
