Unsure of what a certain word means? Search our glossary for definitions of commonly used words.
- Annual election amount — this is the total dollar amount you elect to put into your FSA at the beginning of each plan year.
- Dependent — a dependent is a person whose expenses are eligible for reimbursement through the employee’s FSA. A dependent is usually an employee’s spouse or child(ren) under age 27.
- Eligible expense — items that are reimbursable under the FSA plan are classified as “eligible expenses” according to IRS rule. See a sample list of eligible expenses. [link to Eligible Expenses page]
- FICA — taxes collected for Social Security and Medicare benefits.
- Flexible Spending Account (also known as an FSA) — a pre-tax benefit plan that enables the employee to save 30-40% on eligible expenses. By enrolling in this plan, the participant saves on state, federal, and FICA taxes.
- Grace period — an extension of the period during which expenses can be incurred.
- Open Enrollment — a designated time prior to the start of your plan year during which employees can enroll in the FSA plan and change their benefit elections.
- Plan year — the twelve-month period during which the annual election is effective.
- Run-out period — a period of time after the plan year ends during which participants may submit receipts for expenses which were incurred during the plan year or grace period.
- Uniform Coverage Rule — this rule allows you to access your entire annual election for the Health FSA immediately after the start of the plan year. All other accounts are “pay-as-you-go.” This rule only applies for the Health Flexible Spending Account.
- Use-It or Lose-It Rule — an IRS rule that states that employees must spend any remaining balance in their FSA by the end of the grace period. If you don’t spend the money, you forfeit it.