Administered by Northwest Group Services (NWGS)

Flexible Spending Accounts allow you to have pre-tax money deducted from your paycheck to pay for certain expenses. Since contributions are made through payroll deductions with pre-tax dollars, you decrease your taxable income and thereby increase your take-home pay.

There are two types of Flexible Spending Accounts available:

• Health Care
• Dependent Care

If you are enrolled in Mercer County’s Benefit Plan and have a Health Savings Account, your Flexible Spending Account will be a limited purpose health care spending account. Under this account, you can receive tax-free reimbursement for dental and vision expenses only.  If you do not enroll in the Benefit Plan or are not eligible to have a Health Savings Account, the Flexible Spending Account will reimburse qualified medical, dental and vision expenses.

Note: The maximum annual amount that you can contribute to the health care Flexible Spending Account is $2,700.

Mercer County offers an opportunity for you to save money for daycare for eligible dependents through the Dependent Care Flexible Spending Account. You decide how much to contribute, up to $5,000 per year, per household.

Flexible Spending Accounts must be established each year.
NWGS currently administers this program at no cost to you. If you desires to enroll in the Flexible Spending Account, you must do so during the annual open enrollment period.

Substantiation Requirements
For medical expenses, the IRS requires you to substantiate:

• Date service was received or purchase made
• Description of service or item purchased
• Dollar amount
• Provider or store name
• In some cases, a Medical Necessity Form or physician letter may be required

NOTE: In some cases, the plan’s design requires that your health insurer’s Explanation Of Benefits (EOB) is provided as substantiation for your expense. If you receive a receipt from your provider for a copay amount, make sure the receipt says “copay.” If not, ask your provider to write “copay” on your receipt before leaving the office. Vague or missing information causes your reimbursements to be held up or become ineligible. Keep your receipts and documentation.

For dependent care expenses, the IRS requires you to substantiate:

• Dates of service
• Dollar amount incurred
• Daycare provider name
• Daycare provider signature

NOTE: Daycare expenses must be incurred (not just paid) in order to receive reimbursement. Registration fees cannot be reimbursed until the services are actually incurred. You will be required to report your dependent care provider’s Tax ID (TIN) or SSN on IRS Form 2441 when you file your federal income tax return. Vague or missing information causes your reimbursements to be held up or become ineligible. Keep your receipts and documentation.