Do I need to save receipts for FSA?
Asked by: Dr. Arne Auer PhD | Last update: October 4, 2025Score: 5/5 (13 votes)
Does the IRS require receipts for FSA?
Claims needing receipts are displayed through messages in your online account. IRS rules require that all FSA and HRA claims be substantiated. If the claim cannot be auto-substantiated, the employee is required to submit documentation to support the claim.
What happens if I don't provide documentation for FSA?
Money paid from an FSA for expenses that cannot be proved as FSA-eligible, must be returned to the FSA. If documentation or repayment to your FSA is not received by the end of the year the transaction took place, you may receive an IRS Form 1099, reporting this amount as taxable income to you.
What documentation is needed for FSA reimbursement?
The service documentation will need to include: • Provider Name • Service Dates (not payment date) • Patient Name • Type of Service • Out- of-Pocket Cost or Your provider may sign the form confirming the date of services, charges and other service or product information in lieu of providing separate documentation or ...
What happens to my FSA money if I don't spend it?
The IRS created the ""use or lose"" rule, which states that all money left in your FSA is forfeited after the benefit period ends . If you don't use all of your FSA funds during the benefit period, you risk losing money.
Do I need to keep my receipts??
How to make the most of your FSA money before it disappears?
Check your balance: Log into your FSA account ASAP. Deadlines vary— double-check to be sure when yours is. Plan your spending: Use your remaining funds wisely. Stock up on prescription medications, replace glasses or contacts, and restock over-the-counter items like allergy meds and first-aid supplies.
Can I use FSA for gym membership?
Gym memberships. While some companies and private insurers may offer discounts on gym memberships, you generally can't use your FSA or HSA account to pay for gym or health club memberships. An exception to that rule would be if your doctor deems fitness medically necessary for your recovery or treatment.
Why does FSA need documentation?
If you receive a request for documentation, it's because the IRS requires all flexible spending account (FSA) and health reimbursement arrangement (HRA) transactions to be verified as eligible expenses. This process is otherwise known as substantiating your transaction.
How are FSA expenses verified?
Keep Your Receipts
The IRS may request itemized receipts to verify the eligibility of your expenses. Credit card receipts, canceled checks, and balance forward statements do not meet the requirements for acceptable documentation.
How do I reimburse FSA expenses?
With an FSA, you submit a claim to the FSA (through your employer) with proof of the medical expense and a statement that it hasn't been covered by your plan. Then, you'll get reimbursed for your costs.
How long do I need to save FSA receipts?
While it is not common, you can be audited by the IRS. It is always a good idea to keep your receipts for up to 7 years in case of an audit. It cannot be stressed enough – always keep your healthcare receipts.
What happens if you misuse FSA funds?
Your FSA account can be used for eligible medical expenses only and you are solely liable for the use of the plan. If the Benefits Card is accidentally or intentionally utilized for ineligible expenses, you are responsible for reimbursing your account.
Do I have to report my FSA on my taxes?
One of the great things about an FSA is that you generally do not have to report it on your tax return. You make contributions to your FSA with pretax dollars, which means they are deducted before taxes and reduce your taxable income.
What happens if you don't submit receipts for FSA?
If you miss the deadline, or the claim is denied, your employer must follow the IRS' rules. They may put a temporary hold on your debit card or request repayment until you can locate and produce appropriate documentation. Or your employer may report unsubstantiated amounts as taxable income on your form W-2.
Does FSA get audited?
A school that participates in any Federal Student Aid (FSA) program, including a participating foreign school, generally must have an independent auditor conduct an annual audit of the school's compliance with the laws and regulations that are applicable to the FSA programs in which the school participates (a ...
Are water filters FSA eligible?
Being FSA/HSA eligible allows customers to use their tax-advantaged health accounts to purchase BOROUX water filters, making water filter products more accessible to those prioritizing their health and water quality by minimizing and eliminating contaminants ingested from water.
Does IRS check FSA receipts?
Keep Your Receipts
The IRS may request itemized receipts to verify the eligibility of your expenses.
Are tampons FSA eligible?
Feminine hygiene products: Pads, liners, and tampons all qualify as FSA-eligible expenses. The end of the year is a good chance to stock up if you need to. Pain relievers: Over-the-counter pain medications such as Aleve, Tylenol, and generic versions of the drugs are available for purchase through FSA funds.
What kind of receipt do I need for FSA reimbursement?
DO include stamped provider information on handwritten receipts. DON'T send credit card receipts, cancelled checks, or balance forward statements as they typically do not include all five key pieces of information. DON'T use highlighters on your receipts.
What happens if I buy something not FSA-eligible?
If a debit card transaction was completed for an item that is not FSA-eligible, Lively will notify you that the claim is denied. You will then need to reimburse your FSA for the same amount per IRS guidelines, via your linked bank account.
What is FSA tax on Costco receipts?
Flexible Spending Account, it's a pretax account you load per pay period with a set dollar amount and then use said funds to pay for medical expenses tax free.
Can FSA pay for massage?
Massage Therapy may be eligible for reimbursement with a Letter of Medical Necessity (LMN) with flexible spending accounts (FSA), health savings accounts (HSA) and health reimbursement arrangements (HRA).
Is Planet fitness FSA eligible?
Can you use flexible spending account (FSA) funds to pay for a gym membership or exercise classes? Typically, no. The Internal Revenue Service (IRS) usually doesn't allow funds from an FSA to pay for membership dues at health clubs or gyms.
Can you use FSA for vitamins?
Are vitamins FSA/HSA eligible? You want to be careful when trying to buy vitamins with your FSA or HSA. They are not always deemed a qualified expense. If your vitamins are not prescribed by a healthcare professional or used to treat a specific condition, your purchase most likely won't be FSA or HSA eligible.