Using FSA with TRICARE
Your Employment Questions Answered: Can I Use FSA with TRICARE ?
Sometimes, the best way to learn something new is to seek advice from those who have been there. Asking questions is how we learn about new resources or can give us perspectives that we might never have considered before. When you ask a question, you can gain the knowledge you are looking for that will help you figure out what you need to know to move forward, whatever the subject.
If you are a military dependent, you are most likely using TRICARE. You might also be wondering what that means for the benefits you have at your own job. This question is all about FSA and being able to use it when you also have TRICARE.
Question: Can you still get FSA if you have TRICARE?
I am a military dependent and we use TRICARE for my health insurance. My employer, who is not associated with the government, offers an FSA (Flexible Spending Account) and I can use it for childcare. This would really help my family. My understanding is that I’m not eligible for this while I am using TRICARE. Is that correct? I would really like to be able to use this.
Answer:
According to TRICARE, “You may use your Flexible Spending Account (FSA) benefit to pay for most medical-related out-of-pocket expenses such as copayments and deductibles. You can’t use it to pay for TRICARE enrollment fees or premiums. If you have questions about FSAs, talk with your employer or a tax professional.”
According to TRICARE, these pre-tax accounts let beneficiaries “set aside up to $3,300 from your paycheck before taxes each year. You may be able to use this money to pay for costs that TRICARE doesn’t cover. Remember: Your TRICARE benefit is separate from an HCFSA. Just because you have TRICARE doesn’t mean you’re automatically enrolled in an HCFSA.”
You may be permitted to contribute to your FSA out of your pre-tax income, lowering your income and payroll taxes.
It is important to note that FSAs and Health Savings Accounts are different. TRICARE notes, “TRICARE doesn’t qualify as a High-Deductible Health Plan. If you have questions about Health Savings Accounts, contact your employer or a tax professional.”
FSA Maximum Contribution Limits
Remember too, when it comes to FSAs, there is a maximum contribution limit and that changes each year. You typically have to spend all of the money that you have saved before the end of the year or the funds will be lost. The IRS does however allow employers to opt-in to carry over up to $570 into the next year. Talk to HR about if your company does this.
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