August 18, 2003
Employees seeking reimbursement of medical expenses through a health
flexible spending account (FSA) must follow acceptable means of
substantiating that the expenses are legitimate, a key IRS official said
Aug. 15 at a flexible benefits symposium in Chicago.
Harry Beker, Chief of the Health and Welfare Branch in the Office of
Associate Chief Counsel, explained that the only acceptable means of
substantiation are either a statement from an independent third party
stating that the expense has been incurred (for paper transactions), or by
using the procedures for paying by debit or credit card under Revenue Ruling
2003-43. Under either form of processing, the participant cannot rely solely
on his or her own word that the medical expense was incurred.
In addition, Beker said, the debit or credit card should be swiped each time
an expense is incurred, even if, for example, all family members have the
same co-pay or more than one family member is going to the doctor at the
same time.
Beker spoke at the 16th annual cafeteria plan symposium of the Employers
Council on Flexible Compensation (ECFC).The conference will be covered in
greater detail in the next supplement to the Flex Plan Handbook. For more
information on the Handbook, see
http://www.thompson.com/libraries/benefits/flex/index.html.
For information on books, audio conferences and our weekly ezine, go to:
http://www.thompson.com/libraries/benefits/index.html
Please visit our new Web site, BENEFITSGUIDES.COM, for information, guidance,
helpful forms, model documents and links to valuable resources on adoption
assistance plans, business travel, childcare and more. Go to:
http://www.benefitsguides.com
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Copyright 2003 Thompson Publishing Group, Inc. All rights reserved.
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