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Your Flexible Spending Account: 10 Qualifying Purchases

This article was written by in Health. 7 comments.


Flexible Savings Accounts (FSAs) are often offered by companies to help their employees save money by setting aside income from paychecks to pay for health-related expenses without being taxed. For many Flexible Savings Account holders, the deadline for using the funds set aside is the end of the calendar year. Medical FSAs usually provide the account holder with a debit card that can be used to pay for a wide variety of health-related expenses. Co-payments and co-insurance for visits to the doctor can be paid with the tax-free account, as can prescription and over-the-counter medications.

One unfortunate drawback from the employee’s perspective is the possibility of forfeiting the money set aside if left unused at the end of the year. I don’t have a Flexible Savings Account right now, but if I had been putting aside $100 each paycheck for myself, I would want to make sure I didn’t lose any of that money. Now that we’re approaching the end of the year, many people are likely in this predicament. FSA participants must find qualifying ways to spend hundreds or thousands of their own dollars.

Almost anything that the IRS considers a valid medical expense for tax deductions will qualify for FSA spending. Here are ten qualifying purchases that might surprise you.

  • Travel and transportation. The miles you drive to and from necessary medical care qualifies for reimbursement from your FSA at the rate of $0.24 per mile. Keep a driving log and submit your details for reimbursement, as the debit card won’t come in handy for this particular expense. All travel expenses are considered. If you need to fly outside the United States for medical care, that is covered as well.
  • Car modifications. If you’re looking to pimp your ride, you may be able to pay for the expenses with your pre-tax dollars in your FSA. There is a catch: the modifications must be approved by a medical professional in order to treat a condition. That leads me to believe adding accessibility features might be covered but if you’re looking for a Nitrous Oxide Systems upgrade, you may be out of luck.
  • Lodging. Your FSA will cover lodging expenses incurred for required medical care. If you visit a hospital out-of-town for specialized care and need to stay in the area but not necessarily at the hospital, or if you visit a specialist with her own practice, your stay in a hotel can be paid with funds from your FSA.
  • Abortions. Medical abortions are qualified medical expenses. Congress will be in heated debate soon about whether abortions should be eligible for federal assistance under the new Health Reform law. Meanwhile, you can continue to pay for an abortion with money you set aside to be exempt from income taxes.
  • Over-the-counter cough syrup. This is a good option for end-of-the-year spending. Cough syrup most likely won’t expire for several years, and almost everyone suffers from colds once in a while. If you use cough syrup to ease your symptoms you can stock up now.
  • Swimming lessons. If a doctor advises you to learn to swim for the treatment of a medical condition, use your FSA to pay for the expenses. Aquatic therapy is used to help with arthritis and joint stress and is also used to ease some symptoms of cerebral palsy and autism.
  • Condoms. If you use condoms or other contraceptives, you can pay for these items with your Flexible Spending Account. Buy in bulk now for the future.
  • Sunscreen. Not all sunscreen qualifies for payment from a Flexible Spending Account. Look for sun block with an SPF rating of 30 or higher as well as other sunburn creams and ointments.
  • Viagra. Viagra and similar medications are prescription drugs, so they qualify as legitimate medical expenses for your FSA dollars. Combine this with some of the other items listed here, and you’ll be set for a good time.
  • Weight loss programs. If a doctor suggests a wight loss program or drugs to treat a medical condition, then these expenses can be paid for with your FSA debit card. If you’re just looking to fit back into the jeans you wore in college, you are out of luck.

The good news is that your FSA will always cover Band-Aid bandages, even if you just plan on wearing them as fashion accessories. Have you used your FSA for any interesting expenses?

Photo credit: Mauricio Pellegrinetti
FSA Eligible Expenses, WageWorks

Updated January 16, 2010 and originally published December 1, 2009. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes, also known as Flexo, is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow Luke Landes on Twitter. View all articles by .

{ 7 comments… read them below or add one }

avatar Money Funk

Some of those I wouldn’t have considered deductions. But if the doctor says ‘must have’ then I guess so. I don’t participate in our company’s FSA because if I don’t use all the funds, I lose out. My family’s medical expenses don’t add up to much (luckily). Perhaps, if I look at the prior year’s medical costs and base it on that… might be worth it.

So, if I need a massage because I am stressed, I just need a doctor’s request – Sweet! ;)

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avatar RJ Weiss

I actually used my FSA to pay for lasik eye surgery. When you take into account a little negotiating and that I payed pre-tax, I essentially received more than 30% off.

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avatar John DeFlumeri Jr

That is much more information than I imagined was even available about those flexible spending programs. Very comprehensive!

Thank You.

John DeFlumeri Jr

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avatar Holly

Our FSA allows orthodontics expenses. This is what has prompted us to sign up this year (just wish I had known about it last year when I paid thousands for my first child’s visits)!

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avatar Eric

“Viagra. Viagra and similar medications are prescription drugs, so they qualify as legitimate medical expenses for your FSA dollars. Combine this with some of the other items listed here, and you’ll be set for a good time.”

LOL…I don’t know if it was intentional but the last line cracked me up. ;)

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avatar Amy

My FSA doesn’t allow condoms to be claimed – but basically anything OTC marked ‘medicated’ is covered.. including my blistex medicated lip ointment, woo!

I looked into doing Lasik with it, but I actually save more out of pocket money putting it on my care credit to be paid over the year then the tax advantages from being taken out of my biweekly check.

For massages, if you do it at the chiropractor’s office – it’s covered ;)

I didn’t know about the transportation costs & will definitely try that so I can claim my last $60.. if not, I will definitely be stocking up on allergy & cold meds!

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avatar susan roberson

Can you use FSA for Nitrous Oxide at the dentist?

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