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If you have a child in need of braces, now might be the time to put aside a few thousand dollars into a flexible spending account.  At many workplaces, it is now open enrollment period, the time of year when employees are given up to 30 days to make changes to employer-sponsored benefit plans.  A flexible spending account is a popular benefit option offered by many employers that allows participants to avoid taxation on money spent for health care and dependent care expenses.  At the time of hiring, or during the annual open enrollment period, employees may elect to set aside a portion of their pay for a given year into a flexible spending account.  Whatever money is directed into the account is free from all taxes, including income, Social Security and Medicare.  This means after-tax pay is higher.

An important rule of flexible spending accounts is that the money which is allocated for the plan year must be used within that plan year.  Any money which is not spent will be forfeited and lost.  Furthermore, some plans require that the money be allocated on a monthly basis throughout the plan year as opposed to one lump sum payment.  Please consult with your employer regarding specific plan requirements and restrictions.

If you have a flexible spending account that you would like to apply towards orthodontic treatment and you believe that your child may need treatment soon, it is important to contact your orthodontist well in advance of either the enrollment period or the expiration of the plan year.  Most orthodontists will be happy to evaluate any members of the family for which the monies have been or will be allocated.  Advance notice will allow your orthodontist to properly time orthodontic treatment so that you can take full advantage of your flexible spending account dollars.  If you think you’re facing a big bill for braces or some other medical expense, now is the time to plan!

By Gary Reichhold, DDS