The Basics of an FSA Debit Card

An FSA debit card is linked to a flexible spending account or some other type of tax advantaged savings account. This type of card can be used in many different places, and it can pay for the costs associated with approved medical items. Following are the basics of an FSA debit card.

FSA Debit Card

The FSA debit card is used to gain access to the funds in a flexible spending account. A flexible spending account is a type of tax advantaged account set up through an employer. An employer can provide this as a way for individuals to pay for miscellaneous medical expenses. The employee can set aside a certain percentage of her income in order to fund the account. The money that is deducted from her paycheck does not have taxes taken out of it before it is placed into the account. This lowers the amount of the individual's taxable income and allows her to pay for medical expenses with tax advantaged money.

How It Is Used

This type of card is used in the same manner as any other type of debit card. As long as a merchant takes debit cards, they will be able to accept the FSA card. A transaction with this card will be processed through the regular debit network. Most of these cards have the Visa, Mastercard, or Discover emblem on them and will be processed through those networks. The amount of the purchase will be deducted from the flexible spending account.

What It Can Be Used For

The money in a flexible spending account can be accessed for a variety of reasons. In most cases, people will utilize this type of account in order to pay for various medical expenses that are not covered by their insurance plans. For example, even if you have a good health insurance plan from your employer, you will still have to pay for a deductible or make co-payments when visiting the doctor. You will also have a co-payment when purchasing prescription medication. The flexible spending account debit card can be used to pay for these various transactions.

You could also use the money to pay for drugs that are not covered by a prescription or for other medical supplies. For example, if you needed to purchase over-the-counter pain medicine or bandages, you could do so with your flexible spending account debit card. 

You can also use the money from your account to pay for other types of medical expenses such as chiropractic work or dental work. Some individuals also use the money from this account to pay for dependent care expenses. For example, if you take your child to daycare, you can use this money to pay that bill. If you take care of an elderly parent, you can also use the money for that.

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