Question of the Week

Posted by mroshkoff@basusa.com - 11 October, 2012

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Q.- I use an electronic debit card for my FSA. Every time I take my son to a specialist I have to provide documentation about my copay. Why is this?

A.- The IRS requires all expenses paid with a debit card from an FSA to be substantiated, in order to confirm that they are eligible FSA expenses. Some expenses paid with an electronic debit card, such as co-pays that match the debit card vendor's records and are used at an approved merchant, are substantiated automatically at the point of sale. Some expenses that cannot be substantiated at the point of sale may be substantiated through supporting documentation. If your copayments are not recognized at the point of sale and/or are not from an approved merchant, you will have to provide supporting documentation for the expense in accordance with IRS rules.


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