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Are Vitamins FSA Eligible? Everything You Need To Know and More

Author:

Justin Mares

Published Date:

January 31, 2024

Test

Medicine is the choices we make. Drinking plenty of water, eating a balanced diet, and taking vitamin supplements are acts of healthcare. Every choice you make works to support your overall wellness. Your FSA funds are intended to be used for healthcare needs, so it seems logical that vitamins would be FSA-eligible. They can be, but you’ll need to take a few extra steps to make it happen.

What Is an FSA?

An FSA, or a flexible spending account, is an employer-sponsored spending account intended to be used for health and wellness-related needs. Contributions to an FSA account are all pre-tax. You don’t have to pay income taxes on a portion of your paycheck that you earmark for eligible health expenses and deposit into your FSA account. 

How Does an FSA Work?

A flexible spending account is established through an employer that offers the option to their employees. If your employer offers an FSA, you can choose to opt in. You’ll earmark a specific amount from each paycheck to be deposited directly into your FSA account before taxes are deducted.

Employers often contribute to FSA accounts. They’ll usually match employee contributions up to a certain amount, but they aren’t required to do so. Your employer isn’t required to make any contributions to your FSA. It’s simply nice when they do.

You’ll be issued a debit card linked directly to your FSA account. You can use the debit card for any FSA-eligible purchase. You need to save your receipts to prove that the purchases you made were FSA eligible. Proof of purchase eligibility prevents you from having to pay taxes on your FSA contributions. 

Even though your employer helps to establish an FSA for you, they aren’t in control of it. FSA accounts are held by third-party custodians, and your employer doesn’t make or modify eligibility rules. If there’s ever a question about the eligibility of the purchase or if you need to make a purchase that isn’t covered outright, you’ll submit documentation and proof of purchase to the financial institution that holds your FSA. 

What Happens to the Money in an FSA?

You’re allowed to make contributions to your FSA up to a certain limit. Contributions are divided between each paycheck throughout the year. You won’t earn interest on contributions to your FSA (unlike with an independently controlled health savings account). At the end of the year, your FSA funds can expire. It’s a case of “use it or lose it.”

Employers can choose to provide you with options to avoid losing unused FSA funds at the end of the year. They may give you an extension of a few months or allow you to carry over a maximum amount of unused contributions into the next year.

What Does an FSA Cover?

Since FSA funds are tax-free, the IRS has the final say on what can and cannot be purchased with FSA funds. The list of covered expenses is quite long. 

Medical Expenses

Any expense directly related to a doctor, dentist, or optometrist appointment is usually covered by FSA funds.

  • Co-pays for medical appointments
  • Necessary medical procedures
  • Necessary surgery
  • Prescription medical devices (like glasses)
  • Some alternative medical visits (chiropractor, acupuncture)

Over the Counter Expenses

Medicine you can buy off the shelf at a store is considered an over-the-counter medical expense, including first aid supplies.

  • First aid kids, ointments, and bandages
  • Over-the-counter pain relievers
  • Allergy meds and antihistamines
  • Anti-nausea and anti-heartburn medicine
  • Cold and flu medicine

Medical Supplies

Necessary medical supplies used to treat ongoing conditions or manage healthcare are covered by FSA funds. This includes pregnancy and lactation supplies

  • Diabetes test kits
  • Lactation pads and pumps
  • Pregnancy tests
  • Hearing aid batteries
  • Denture care supplies
  • Contact lens care supplies and over-the-counter reading glasses

Are Vitamins FSA Eligible?

Vitamins and minerals are essential to sustain human life. You literally cannot live without them. Despite this, the IRS doesn’t believe that vitamins should be covered by FSA funds. The logic behind the decision not to cover vitamin supplements is that most people should be able to meet their daily vitamin needs through their regular diets. This isn’t always the case. 

There may be some circumstances where a medical professional feels that vitamin supplements are necessary for someone’s health. People with absorption issues, deficiencies, or people taking medications that make certain vitamins difficult to process may not be able to meet their daily vitamin needs simply by eating a balanced diet. 

If a doctor declares that vitamin supplements are necessary for your health, you may be able to utilize a workaround that allows you to purchase vitamins with your FSA funds. 

What Is a Letter of Medical Necessity?

Sometimes people need things outside of the normal scope of pharmaceuticals for medical purposes. There are plenty of reasons why a vitamin supplement may be used to treat or cure a medical condition. For example, vitamin B12 deficiency is serious and can have life-threatening consequences. If you have vitamin B12 deficiency, you need supplemental vitamin B12. 

A Letter of Medical Necessity is a letter written by a doctor that describes a diagnosis of your needs or condition and essentially prescribes a specific treatment to treat or cure your condition. In this case, vitamin supplements would be a necessary treatment. 

Your doctor will prepare an official Letter of Medical Necessity (LMN) for you to submit to the institution that holds your FSA. Don’t submit the letter to your employer, as they don’t play any role in the decision-making process. You’ll keep a copy of your letter with your receipts from purchasing vitamin supplements with FSA funds. 

Don’t lose your letter and your receipts! You’ll need them at the end of the year. If you can’t produce them, you’ll be responsible for paying a tax penalty on the money you spent. 

What Else Can You Use a Letter of Medical Necessity For?

Letters of Medical Necessity can be used for any health or wellness-related purchase that your doctor deems necessary for your health. This can include things like gym memberships, bone broth, saunas, and exercise equipment. The only catch is that they need to have some type of medical necessity for you as dictated by your health. 

There are many reasons why a doctor might agree that a workout routine and healthier food are essential for your health. If you have a health condition that could be significantly improved through the use of a sauna or a cold plunge, your doctor may agree that investing in one for your home would have significant therapeutic potential for you.

Making the Most of Your FSA

Companies often partner with employers to offer discounted rates on health and wellness goods and services to their employees. You may receive a discount when you shop with certain health food brands or sign up for a specific gym. You can stack these discounts with your tax-free FSA money to make your health and wellness needs even more affordable. 

In addition to an FSA, your employer may also offer other employee health and wellness programs. Your HR department may have more information about special offers or discounts you can take advantage of when you’re empowering yourself to take control of your own health.

How To Buy Vitamins With Your FSA

Many retailers that sell vitamins and supplements don’t accept FSA/HSA payments. You’ll need to purchase vitamins with your own money and use your FSA/HSA funds to reimburse yourself for your purchase. This can be a bit of a hassle, especially if you’re only spending $15 on vitamins. It may be worthwhile to save your receipts and reimburse yourself at the end of the year rather than going through all that trouble for a small purchase.

Alternatively, you can find a retailer that accepts FSA/HSA payments and use the debit card linked to your account to make a direct purchase. We’ve worked to create a solution to make wellness easy. 

Health and Wellness Are Easy With Truemed

The easiest way to buy vitamins with your FSA is to shop with a retailer that offers FSA/HSA payment processing. Truemed works with retailers in the health and wellness space to offer FSA/HSA payment processing that makes purchasing vitamins with your HSA as easy as making any other purchase with your normal debit card.

We currently work with nearly three dozen supplement companies that offer vitamins, probiotics, and herbal supplements you can add to your daily wellness routine. Truemed makes it easy to take control of your own wellness. 

Sources:

IRS: 2024 Flexible Spending Arrangement contribution limit rises by $150 | Internal Revenue Service

Flexible Spending Account (FSA) - Glossary | HealthCare.gov

Use an FSA to pay for eligible expenses like these | University of Hartford

Vitamins and Minerals | NCCIH

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