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PEP FLEX is a flexible spending account that saves you money by setting aside a portion of your pre-tax salary to pay eligible expenses. There are two different FLEX accounts — one for medical expenses and another to help with dependent childcare costs — and each has important rules to keep in mind when using the benefit. There are two variations of PEP FLEX for medical expenses — some employers offer a ×500 rollovers, which allows you to move some unused funds into the next plan year. The other option offers a 75-day grace period by which all remaining funds must be used, or they will be lost. It’s important to know which account you have and the deadline by which expenses must be incurred, so you don’t risk losing money you don’t spend. If you’re not sure which version you have, ask your employee benefits manager. Are you on The STAR Plan or currently have an HSA? If you have a Health Savings Account, you cannot have a FLEX account for medical expenses. You can, however, take advantage of a Limited FLEX account to help cover dental and vision expenses, and you can have a FLEX account for dependent daycare. The IRS limits the amount of pre-tax money you can put into your FLEX account during a plan year. You can contribute up to a yearly limit for healthcare expenses, which is available to use immediately at the start of the plan year. Among the most common items that qualify for reimbursement: Co-payments, Contact lenses, eyeglasses, orthodontia, prescription drugs and more. Your family can set aside as much as $5,000 for childcare expenses, which accrues through evenly distributed contributions throughout the plan year. You must submit claim forms to receive dependent care reimbursement. You cannot use your FLEX account as a debit card for childcare expenses.
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