SPENDING ACCOUNTS
Employees have the opportunity to enroll in a number of spending accounts through WEX to pay for eligible expenses.
Hamilton Lane understands the value of your dollar and most importantly, how to stretch it. As part of the benefits package, employees have the opportunity to enroll in Flexible Spending Accounts (FSA). FSAs allow you to set aside funds on a pre-tax basis that you can then use for qualified expenses.
HEALTH CARE FSA
A Health Care FSA is a pre-tax benefit account used to pay for eligible medical, dental, and vision care expenses. It’s a smart, simple way to save money while keeping you and your family healthy and protected. You are eligible for this benefit if you are enrolled in the Traditional PPO plan. You may not enroll in the Health Care FSA if enrolled in one of the HDHPs.
When you make an election, this contribution is automatically withheld from your paycheck, so it does not count as income for certain tax purposes. You can elect up to the maximum of $3,050 to be deducted pre-tax for the plan year. These funds are available to you at the beginning of the plan year.
FSA's do have a 'Use it or Lose it Rule' - however, Hamilton Lane employees may carry over $610 into the next plan year. Any additional funds beyond $610 cannot be rolled over, meaning that they will be forfeited at the end of the plan year.
You can use your FSA for:
- Prescriptions
- Over-the-counter medicine
- Glasses, contacts, and LASIK
- Dental services and procedures
- Copays and deductibles
- Flu shots
You can also use your FSA funds to purchase eligible items online through the FSA Store:
DEPENDENT CARE FSA (DCFSA)
A dependent care FSA is a pre-tax benefit account used to pay for eligible dependent care expenses for your children under the age of 13 or qualified elderly dependents. If you are married, your spouse must also be working, actively looking for work, be a full-time student or disabled in order to utilize the DCFSA. Like the health care FSA, when you make an election, this contribution is automatically withheld from your paycheck, so it does not count as income for certain tax purposes. You can elect up to the maximum of $5,000 for the plan year. These funds are available as they are contributed via payroll contributions.
DCFSA's do have a 'Use it or Lose it Rule' and, however unlike the health care FSA, there is no rollover feature. This means that any unused funds left in your account at the end of the plan year will be forfeited.
You can use your DCFSA for:
- Licensed nursery schools
- Qualified childcare centers
- Adult day care facilities
- After school programs
- Summer camps for dependent children under age 13
- Preschool tuition
The IRS allows you to claim work-related dependent care expenses as a credit on your annual tax return. You can use a Dependent Care FSA and claim the tax credit, as long as you do not claim the same expenses for both. A rule of thumb is that if you earn less than $39,000 annually, it is more beneficial to forgo the Dependent Care FSA and take the full dependent care credit on your income tax credit. Please consult your tax advisor to determine what scenario may make sense for you.
COMMUTER & TRANSIT SPENDING ACCOUNT
An employee may establish a spending account to reimburse predictable expenses incurred for out-of-pocket commuter and transit expenses. Once you determine your annual predictable expenses for the period of time covered by the Plan Year, a portion of that amount may be paid for with pre-tax pay. The elected pre-tax pay amount is then deposited on a per pay basis to the spending account. The maximum pretax deferral allowed for 2023 is $300 per month for the Commuter and Transit Spending Account.
You can use your WEX Commuter Transit Spending Account for transportation costs associated with:
- Public Transportation
- Parking
- Ridesharing
- Bike Maintenance & Repairs
