Paul Thomas, CPA wrote:
- quote -

Couldn't they just wait until the work was completed then
file the claim?

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"Jillian" <actipis[at]aol.com> wrote

- quote -

It sounds like a valid expense. But the company policy also
sounds valid. What they are trying to avoid is for the
expense to be paid/reimbursed and for you to cancel the
services and get a refund. That is not allowed.

- quote -

File the appeal. You based your actions on the website
wording.

--
Paul Thomas, CPA
paulthomascpapc[at]bellsouth.net

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"Jillian" <actipis[at]aol.com> wrote:

- quote -

I am NOT positive but I think that the law/regulation on FSA
may have changed to allow the spending to occur for some
period into the following year. MAYBE as much as 45 days
into 2006 for 2005.

DON'T take my word for it, but if it is true, that would
give you some time to get this worked out. That is, you
could hold off in spending other health care dollars in case
the braces do get allowed.

I hope that some who knows will respond. However, it
is possible that the IRS may allow the extra time but your
company might not. Try to find out ASAP.

BTW - I believe that the typical company can administer
ttheir FSA program and maybe even come out ahead by
the money that some employees put into their accounts
and do not spend. I think I heard somewhere a few days
ago that it averaged about $100 per employee. This would
presumably be employees who left the company during
the year and some who simply didn't spend it all.

A higher tax bracket employee who put $1,000 in an FSA
and only spent $900 would still have saved more than the
$100 "left on the table."

Ivan

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Jillian wrote:

- quote -

I suspect the logic behind this is to avoid people signing
up for a $6,000 annual contribution to the FSA, putting
braces on their kid January 1, and quitting, leaving the
employer to make up the shortfall. No tax issue here.

If you're dealing with a Third Party Administrator, I'd go
talk to someone in your HR department. They may be able to
shake your reimbursement loose.

Phoebe

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"Jillian" <actipis[at]aol.com> wrote:

- quote -

I'm not a tax pro, but believe that this is allowed by
Federal law but also must be allowed by your plan.

- quote -

It sounds as if you are covered.

- quote -

Well - make a copy of the Web site IMMEDIATELY. This is a
key document for you.

As far as I know the company would have an obligation to
comply with the rules posted on a web site they have
established for the express purpose of allowing employees to
determine which expenses are or are not covered. And, if
they have changed their policy but not yet distributed
copies of the new policy to employees, they may be obligated
to follow the rules of the old plan. Again - I'm not a
lawyer but had a similar situation with a health insurance
plan and that was covered by ERISA. Under ERISA companies
that provide certain plans, such a health insurance, have an
Federal obligation to provide those covered with copies of
current plan. There are penalties specified for failure to
comply. Again - this is not legal advice, just suggestions
from someone who was in a similar situation.

- quote -

I assume you mean periodic payments instead of a lump sum
payment. This would probably be a function of your plan, not
IRS rules.

- quote -

For the amount of money involved it may be worth it to
contact an attorney who deals in these matters, get his
advice and have him send a letter to the company regarding
their obligations.

- quote -

Anything you do will take this past Dec 31.

- quote -

Nothing will probably happen before Christmas.

--
Vic Roberts
Replace xxx with vdr in e-mail address.

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I recently had braces put on my son. I submitted receipts
to the flexible spending account plan through my work and my
claim was denied. The reason the claim was denied was
because we paid the total amount, and did not make payments.
However, my receipt specifically stated that the total
amount was $4800, of which $2650 was for services rendered
in the first month. One of the main reasons that I paid in
a lump sum was because I was saving this money specifically
to put braces on my son. I also received a discount by
paying the entire balance.

Can anyone tell me if this is a valid expense? Prior to
gettin the braces, I checked the web site of the Flexible
Spending account for my company and it listed braces (paid
in a lump sum) and as an allowable expense. They are now
claiming that because the braces will be on my son fro 18
months, the expense hasn't really been incurred. However, I
feel that it isn't unreasonable for the majority of the
expense to occur when the braces were actually put on my
son. The remaining expense would be minimal to the
Orthodontist (tightening every three months). They also
claimed that their web site was wrong and they follow a
different policy (of which they have yet to produce).

I have also researched the IRS web site and did not find any
information that stated I had to make payments on the braces
in order for the expense to be allowed.

Do I have any recourse? They have told me to file an
appeal, however, if I lose the appeal then my money is lost.
Additionally, the appeal process takes up to 60 days, at
which point I have no other options to spend the money. I
really need to know if I should go out and get my family
glasses (which are not needed this year, but would be better
than completely losing the money) or go for the appeal and
keep my fingers crossed.

Any advice would be greatly appreciated...this is really
putting a damper on my Christmas....I was really counting on
that reimbursment.

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