Flexible Spending Accounts
The Flexible Spending Accounts (FSA) are administered by Cigna. There are two FSA accounts offered to employees, Healthcare and Dependent Care spending. The accounts are funded by contributions made by the employee each pay period (24 periods) on a pre-tax basis. The amount contributed to the account can be used on eligible expenses that incur during the time periods listed in the table below.
Healthcare Flexible Spending Account
Roll Over Benefit: If you have any Healthcare flexible spending dollars left at the end of the tax year, you can roll up to $550 of the remaining balance to the following years’ FSA account. This is contingent that you enroll and contribute in the following year’s FSA benefit. The roll over amount has increased due to Covid-19.
For 2020 Healthcare FSA: The IRS has increased the 2020 calendar year maximum for contributions. Employees can now set aside healthcare FSA dollars up to $2,700 for the year. (View the bottom table for 2020 FSA contribution limits and dates).
Cigna Verification: On occasion, Cigna may ask for expense verification and you will need to submit appropriate documentation for the expense, such as a detailed receipt or Rx script. If documentation is not received, the Cigna debit card will be deactivated until expenses can be verified as an eligible expense under FSA definition. If you need help with an FSA expense verification, Cigna can assist. Email Cigna Help for assistance.
Tip: Be conservative with how much you elect. If you enroll in the FSA Health Care Spending Account and you earn the Health Reimbursement Account (HRA) incentive by participating in the wellness program and/or completing the Healthy Pregnancy program with Cigna, the FSA will pay first. FSA dollars must be incurred within the calendar year and the reason these funds are used first is that the FSA has a limit to the remaining amount that can be rolled over.
Dependent Care Flexible Spending Account:
This benefit provides a tax savings for your family. It lets you set aside money before taxes to pay for things like day care, summer day camp, and other dependent care expenses. If you plan on enrolling in this benefit, you need to estimate your annual out-of-pocket day care expenses to determine how much you want to contribute annually to a Dependent Care FSA. The IRS allows a maximum of $5,000 that you can contribute annually. Under the City, this total can be reached by contributing the maximum to this benefit. See table below to see the minimum and maximum amounts you can contribute per paycheck.
How does a Dependent Care FSA work? You will have to pay for your dependent day care expenses out of pocket and then submit the expense to Cigna for reimbursement. Through your www.mycigna.com account and MyCigna App, you can submit a reimbursement request form and turn in all receipts and back-up documentation to show the expense is considered eligible. You will be reimbursed for eligible expenses using dollars you contribute to your Dependent Care FSA.
Tip: Unused Dependent Care FSA dollars you contribute cannot be carried over to the following year, so carefully elect the amounts you want to contribute.
|Tax Year:||2020 Healthcare Flexible Spending Account||2020 Dependent Care Flexible Spending Account|
|Expense Type:||Healthcare Related||Eligible Dependent Care|
|Minimum Per Pay Period||$5.00||$5.00|
|Maximum Per Pay Period||$112.50||$208.33|
|Period to Incur Expenses||January to December 2020||January to December 2020|
New Hires may elect the per pay period maximum. To calculate the annual amount, you multiply the remaining pay periods in the year by the per pay period amount. (See document section or Calculate your annual amounts (PDF)).