St. Louis, MO, October 22, 2016 --(PR.com
)-- Millions of Americans are being invited by their employers to fund their Flexible Spending Accounts (FSA) for 2017.
FSAs are a tax-saving way to set aside funds to pay for healthcare services and items that are not covered by insurance, such as deductibles, doctor co-payments, prescription drugs, vision care, medical supplies, and dental care, including orthodontic treatment. All the funds accumulated in the accounts are tax-free. The current law allows individuals to set aside $2,550 per year. A husband and wife whose employers offer the FSA benefit may each set aside up to $2,550 for 2017. A 2013 enhancement to the law allows account holders to roll over up to $500 of unused funds into the following year.
Because orthodontic treatment is one of the few healthcare expenses one can anticipate, many financial planners include planning for it when working with families. “Orthodontics is something we absolutely discuss in our practice,” says Marguerita Cheng, CFP, a planner with Blue Ocean Global Wealth in Potomac, Maryland. “Our number of adults who are opting for [orthodontic] treatment is growing all the time, making this conversation relevant at all ages. We have many clients in their 40’s and 50’s who are in treatment.”
1. 1. An FSA saves you money on taxes.
All FSA contributions are tax-free. “If your family is paying for orthodontic treatment, it’s better to utilize tax-advantaged benefits such as FSAs or HSAs (Health Savings Accounts) rather than simply paying out of pocket,” says Travis W. Freeman, CFP, and president of St. Louis-based Four Seasons Financial Education, a firm that advises employees on how to maximize their benefits. “Never depend on credit cards to pay for treatment. If you must, temporarily lower your 401(k) deferrals, or rely on a home equity loan, and place this cash in your FSA.”
2. Many orthodontists will work the “use it or lose it” rule to your advantage.
In most cases you’ll lose most of your FSA stash if you don’t use it at the end of the year ($500 may be rolled over), but many orthodontists will help you use remaining funds to pay for treatment in the current calendar year. “Check with your orthodontist’s office to see if they can help you at year end,” says DeWayne B. McCamish, DDS, MS, president of the American Association of Orthodontists. “This is a good way to ensure that you use all the funds you worked so hard to save.”
3. Ask about payment plans.
Most orthodontists offer a variety of payment plans to make treatment affordable. In addition, many employers offer dental insurance that includes orthodontic benefits to cover a portion of the fee for care. “Orthodontists are accustomed to working with families that often are juggling other expenses,” says Dr. McCamish. “By using a well-planned tax-advantaged FSA, combined with payment options offered by the orthodontist, plus other available benefits, orthodontic care is within the means of most families. The benefits of orthodontic treatment are lifelong, and can be one of the best investments families can make in their health and well-being,” concludes Dr. McCamish.
An important bill now working its way through Congress could enhance FSA benefits. Visit mylifemysmile.org
and click on “Support FSA Increase,” to learn about proposed modifications to FSAs and how you can encourage your members of Congress to support this proposed legislation.
About the American Association of Orthodontists
Members of the American Association of Orthodontists (AAO) help children, teenagers and adults achieve healthy, beautiful smiles.
Orthodontists are uniquely qualified specialists who diagnose, prevent and treat dental and facial irregularities to correctly align teeth and jaws. Orthodontists receive an additional two to three academic years of specialized education beyond dental school at an accredited orthodontic residency program.
Founded in 1900, the AAO is the world’s oldest and largest dental specialty organization. It represents more than 18,000 orthodontist members throughout the United States, Canada and abroad. The AAO encourages and sponsors key research to enable its members to provide the highest quality of care to patients, and is committed to educating the public about the need for, and benefits of, orthodontic treatment.
Only orthodontists qualify for AAO membership. For more information, and to find AAO-member orthodontists near you, visit mylifemysmile.org.