Friday, June 10, 2005

Fun with FSA debit card

I went to the eye doctor the other day, had my annual checkup and ordered new glasses. When I was done, I paid for everything with my flexible spending account debit card. I am really going to miss this card when I leave my job. The greatest convenience about it is that you charge all your applicable health care expenses to it and there is no need to forward your saved receipts to the FSA administrator, wait for the refund check, and go to the bank to cash your check.  

But here is the part that I am uncertain about, and some of my co-workers may want to pay attention because this will apply to them too one day. Let's say I set up my FSA to deduct $10 per paycheck and a total of $240 is withheld per year. Let's say that I quit at the end of June, when only $120 has been taken out and that by the end of June I have already spent the entire $240. Obviously since I am no longer working at the company, there will be no paycheck to deduct the extra $120 that I have spent above and beyond what I have already contributed. How will the FSA administrator get back the $120 that it is "in the hole" for?

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