Flexible Benefits Plans
Providence College offers a Flexible Benefit Plan with a Premium Conversion Account and Flexible Spending Accounts (FSAs) to allow employees to use pre-tax monies to pay for medical and dental premiums and for qualifying non-reimbursable healthcare and/or dependent care expenses. Participation in the Premium Conversion Account and/or Flexible Spending Accounts is optional.
Employees become eligible to participate in the Flexible Benefit Plan on the same effective date of eligibility for healthcare benefits.
Premium Conversion Account
A Premium Conversion Account allows employees to pay for their share of medical and dental insurance premiums with pre-tax dollars.
A FSA takes advantage of federal tax laws that allow employees to pay for eligible healthcare and/or dependent care expenses that are not otherwise covered by medical insurance or deducted on your personal income tax return with tax-free dollars. The maximum amount an employee can contribute to the Healthcare FSA is $2550 (effective October 1, 2015), and $5000 to the Dependent Care FSA. (plan year October 1 through September 30).
The annual amount you elect to contribute before taxes to the FSA is divided into equal installments and taken from your paychecks during the year. Your election to contribute to the FSA remains in effect throughout the Plan Year. Changes to the deduction amount may be allowed only if you have a “qualifying event” such as a change in your family status.
The IRS requires that you use all the money in your Dependent Care FSA each Plan Year for eligible expenses incurred during the year. For the Dependent Care FSA there is a 90-day grace period following the end of the Plan Year to submit expenses for reimbursement, or money remaining in your account will be forfeited; however, expenses must have been incurred by September 30th.
For the Healthcare FSA, the IRS allows a rollover of up to $500 at the end of the plan year, allowing those monies to be utilized for the entire following plan year (12 months). Any remaining balance above $500 at the end of the Plan Year will be forfeited.