Wait, what do you mean these aren’t eligible under my FSA?

2020 pre-tax limits

“Claim denied: expense is not eligible under an FSA.”  If you’ve ever received one of these, you probably thought “But wait! I used it for [insert medical term] purpose!”  Unfortunately, while we all know your intentions were pure, the IRS has a two part requirement for an expense to be eligible:

  1.  It must be used to diagnose, cure, treat, mitigate and/or prevent a disease, injury or symptom of a disease.
  2.  It’s primary purpose must be for #1 (this is known as the “but for” clause).

The first part is easy to meet: “I went to the doctor to diagnose and treat my cold therefore my bill is eligible”.  The expense is eligible since it treated a disease and the primary purpose of going to the doctor was to treat the disease.  Let’s face it, most of us probably don’t want to see our doctors if we don’t need to.

Seems pretty straight forward, right?  But what about this one:  “My dentist told me to start flossing to prevent gingivitis so my dental floss is eligible”.  This expense meets the first requirement but since dental floss can be used for other purposes, it’s considered a general health expense.  Therefore, the expense is not eligible.

There are many items that we may believe are (or should be) eligible.  Have you ever wondered why these common expenses aren’t?

Bug Spray – “I wear bug spray to prevent bug bites that may transmit a virus”

Bug bites stink!  There’s no way around it.  Not only do they itch for days but they can carry viruses like Lyme disease, West Nile, or Zika.  So why is this expense not eligible?  The reason is shockingly simple. The IRS has not ruled in favor or against it yet (which technically means it’s not eligible).  However, some in favor say it’s purpose is to prevent insect bites, which are themselves an injury or disease. Others see it as eligible only when there is an imminent probability of contracting a specific illness from a bug bite. While we wait on them, as someone who forgot to use their repellent before going outside this weekend and is trying desperately to not itch, I’m firmly for this one!

There is one hope for now – bug bite treatments like antihistamine can be FSA eligible (with a doctor’s note).

Fitness Trackers – “I bought a Fitbit to help me lose weight”

This one’s gotta be an eligible expense, right? Studies say that losing weight and staying healthy prevents diseases and can ward off injury.  A wearable device can help us do that by counting our steps and monitoring our heart rate.  But, they can do other cool things like take phone calls, play music, and even snap photos.  So, while they definitely can assist with reaching goals and maintaining a healthy lifestyle, this expense is just not eligible.

Ninja Edit: This expense actually is eligible…with some conditions.  It must be accompanied with a note of medical necessity signed by your doctor and must be used to treat a specific disease (“losing weight” doesn’t count).

Dark Chocolate (in moderation, of course) – “I bought chocolate because it’s a heart healthy food”

OK. I’ll be the first to say this certainly doesn’t meet the “but for” clause, but hear me out. The cocoa butter in chocolate is known for having heart healthy benefits due to its high level of flavonoids and antioxidants.  According to the Harvard Medical School, these help protect the arteries, lower blood sugar, and decrease the tendency for blood clots.  Sounds like it fits #1 but it’s primary use undoubtedly isn’t medical (though I’m sure some of us believe in its medicinal purposes).

Wait, what else isn’t eligible under my FSA?  Check out our eligibility list for a full rundown of items that you won’t have to worry about!