Swimsuit shopping, oof! Is swimsuit shopping anyone’s “thing?” As a fair-skinned mid-western that loves SPF50, health savings accounts (HSAs), cold beer and tacos, I speak with conviction when I say shopping for beachwear is not my favorite. So, imagine this Hoosier’s surprise when a day of swimsuit shopping turned into the best retail day ever! All it took was a (nameless) department store, a fierce $100 suit in my size, and a $0.01 price tag. I mean, pink isn’t my color, but who wouldn’t get pumped over a flawless fit and 99.99% savings? Sure – you’re feeling confused about this article’s title. Probably asking yourself, “what does a 1 cent purchase have in common with the CARES Act or qualified HSA & FSA expenses?” The answer… is savings! As a self-proclaimed “smart consumer,” my brain is constantly thinking about cost, quality and experience. This isn’t to say I don’t splurge on tacos, cold beer and unnecessary handbags, but I’m absolutely in the business of “smart shopping” – especially on healthcare and tax-breaks.
Tired of spending hard-earned cash on boring, yet essential stuff? Duh—who isn’t? When participating in a tax incentive program like health savings account (HSA) or flexible spending account (FSA), we expect a certain percentage of savings. Never 99.99% savings, but meaningful savings, nonetheless. Well listen up, HSA and FSA users! The passing of the U.S. federal government’s CARES Act called for immediate enhancements to some of our favorite tax-advantaged plans. Learn more about the CARES Act and how to minimize spend on eligible medical expenses, making some regular purchases “suck less!”
What is the CARES Act?
· The Coronavirus Aid, Relief and Economic Security (CARES) Act was passed March 27, 2020.
· This bill is part of the $2 trillion stimulus package to provide financial assistance to Americans affected by the COVID-19 coronavirus pandemic.
How does the CARES Act help (HSA and FSA) users to minimize “the suck” of essential medical spend?
1. Tylenol is now a pre-tax eligible expense
Over the counter (OTC) medications are reinstated as qualified medical expenses. The update may be sweeter than a 1-cent swimsuit – and just like the good ole’ days, you can swipe your participant card to buy all the Benadryl you need. No prescription needed. Take note, most vitamins, herbal medicines and supplements are still ineligible, as the FDA does not consider these to be medication. If prescribed a vitamin to treat a medical condition, contact your plan’s administrator to learn how to request approval of medical necessity.
2. Tampons are now a pre-tax eligible expense
Scratching your head or not really following? Use tax-free dollars to purchase period products like tampons, pads, liners, cups, and similar products for women in your household.
Key Takeaways for HSA and FSA Users:
· Buy over the counter drugs with your health savings account or flexible spending account.
· Purchase menstrual care products with your health savings account or flexible spending account.
· Reimburse yourself from your health savings account or flexible spending account for over the counter drugs and menstrual care products you purchased with post tax dollars, since January 1, 2020.
· Keep documentation for all eligible purchases (receipts or EOBs).
· If your card cannot process an eligible sale, keep your receipt and file a manual claim for reimbursement through your account provider.
Well, there you have it! Thanks to the CARES Act, select tax-advantaged plans are more flexible than ever! If something has held you back from participating in the past, perhaps it’s time to re-evaluate your qualified medical expenses and your opportunity for tax-savings.