Limited Purpose Flexible Spending Account (LPFSA)

A limited-purpose flexible spending account (LPFSA) allows you to deduct a set amount of pre-tax money from each paycheck to pay for certain IRS-qualified out-of-pocket dental and vision expenses, such as dental and vision checkups, copays, braces, and glasses for you and your dependents.

Simply use your LPFSA debit card at the point of sale for services, or file a claim for reimbursement. Since the IRS governs this pre-tax benefit, you can only use your LPFSA funds for IRS-approved dental and vision expenses.

Learn More: FSA 101

LPFSA Eligible Expenses Include

Dental & vision co-insurance, copayments, and deductibles
Artificial teeth and dentures
Orthodontia
Dental crowns and fillings
Dental X-rays
Occlusal guards

Non-cosmetic dental & vision office visits, exams, and operations
Contact lenses and contact lens solution
Lodging & transportation for dental or vision care
Prescription eyeglasses and sunglasses
Lasik eye surgery & radial keratotomy
Shipping and handling fees on eligible expenses

See a rundown of eligible expenses

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Here's a quick overview:

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Beginners: Start Here!

Are you taking advantage of your pre-tax savings accounts, such as FSA or HSA? Let’s break it down:

What are tax-advantaged benefit accounts
What is an eligible expense
How much to save
How they save you money

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Answers to Your Questions

Determine how much you need to cover the year's out-of-pocket dental and vision expenses. We withhold that amount from your paycheck pre-tax in equal installments and deposit it into your LPFSA.

When you have an eligible expense, simply use your LPFSA debit card at the point of sale.

Alternately, you can pay with your own funds up front and submit a claim for reimbursement. Save your receipts; you may be required by the IRS to verify expenses.

To participate, you must enroll within 30 days of your date of eligibility, a qualifying event, or during annual open enrollment.

Use your LPFSA on co-pays, deductibles, co-insurance, materials such as glasses and braces, copays, and other qualified vision and dental expenses. See IRS Section 502 or visit the FSA Feds government website for a detailed rundown LPFSA eligible items.

The IRS's "use it or lose it" rule requires unused funds to be forfeited at the end of the calendar year.

Participants have 90 days from the end of the plan year to file claims for the previous year's expenses.

You may roll over up to a certain amount of unused funds from one year to the next. See IRS Publication 969 for the current rollover amount. All other funds unused at the end of the plan year will be forfeited.

Because of the use it or lose it rule, it's important to carefully plan for your forseeable dental & vision expenses for the coming year. This calculator may help you with your FSA election decision:

FSA Calculator

Anyone currently using an HSA. You cannot use HSA and health FSA concurrently since both apply funds to dental and vision expenses.

Like the FSA, the LPFSA is a front-loaded account. This means the funds are available to use at the beginning of the year or on your initial eligibility date. You can use the debit card to pay your provider directly or get reimbursement for claims by direct deposit.

You'll receive a debit card that's automatically loaded with your available funds. Use the debit card to pay your provider directly at the point of sale.

Watch this video for more info about the LPFSA debit card:

Read more in-depth questions and answers specific to your FSA debit card:

Debit Card Info

Although IRS rules state you can't have both an HSA and FSA in the same tax year, you may utilize an LPFSA concurrently with HSA. This account is available to those who may not be enrolled in a group medical plan.

You maximize your savings and tax benefits by restricting your FSA reimbursement to only vision and dental expenses with an LPFSA and using it in conjunction with an HSA. Spouses are each eligible for their own individual LPFSAs, up to the maximum allowable election per calendar year.

Here's more info about holding an HSA and LPFSA concurrently:
LPFSA + HSA

You can change your elections only within 30 days of a federally-qualifying event or during annual enrollment. Since this is a pre-tax, front-loaded account, the IRS regulates that the annual election must remain fixed for the entire year. It is important that you calculate your expected health care expenses carefully before election so you do not elect too much or too little. This online calculator can help you determine how much to save (remember, this application would be only for qualified dental and vision costs:)

Claim form

If your employment ends, you may claim FSA expenses incurred only through the date of your termination. You must submit all claims within 30 days of your termination. Any funds not claimed within that time frame may be forfeited.

The maximum adjusts each year for inflation. For the current maximum, see IRS Publication 969. There is no minimum.

You can also see maximums in the annual deferral limits section of this page:

Annual Deferral Limits

No. Per IRS regulations, you must re-enroll each calendar year. Check out our annual FSA enrollment resources for more info on how that works:

FSA/HSA Annual Enrollment

IRS regulations forbid changing your election unless you experience a federally-qualifying event or during ther annual FSA/HSA open enrollment period. Since this is a pre-tax, front-loaded account, the election must remain fixed for the entire year. Calculate your expected dental & vision care expenses carefully so you do not elect too much or too little.

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