Advanced Flex Plan Administration with the Human Touch
Limited Purpose Flexible Spending Account
A Limited Purpose Flexible Spending Account (LPFSA) allows employees to contribute pre-tax dollars to pay for dental and vision expenses.
Why an LPFSA?
The LPFSA is typically used in any one of the following scenarios:
Supplement to Group Health Plan
Employers who offer a Group Health Plan without dental and vision coverage can offer an LPFSA as a cost effective way to help employees save on these expenses.
Participants Moving to an HSA from an FSA
EMPOWER will automatically carry forward unused Health FSA balances into an LPFSA if the participant enrolls in an HSA and the Employer has an FSA, HSA, and LPFSA with EMPOWER
How an LPFSA Saves
- Since employee contributions reduce taxable income, the Employer’s FICA/FUTA is reduced.
- Contributions are pre-tax. This can save the participant 25%-40% on eligible expenses.
Employees who are eligible for the Group Health Plan are eligible to enroll in the LPFSA. Participants can join the LPFSA without enrolling in the Group Health Plan.
Who Can Contribute
Participants and Employers can contribute to an FSA.
How it Works
The Employer hosts Open Enrollment with employees and enrolls those who wish to sign up for the LPFSA.
The Employer deducts pre-tax contributions from each participant’s paycheck. These contributions are held by the Employer.
EMPOWER administers the Plan and issues reimbursements to employees. The Employer only pays for expenses used by employees.
Employees enroll in the LPFSA and choose annual their annual elections.
The Employer deducts pre-tax contributions from each participant’s paycheck.
Participants pay for eligible expenses with the EMPOWER Visa Debit Card or seek reimbursement from EMPOWER.
EMPOWER Can Tailor an LPFSA to Meet Your Needs
Employers can customize their plans through many options, including:
- EMPOWER Visa Debit Card
- Check Register sent to Employer
- Direct Deposit
Employers can choose how unused funds can be used in the next Plan Year.
Employers can choose the maximum annual election limits for participants.
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