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NOVEMBER 2022
Spend less on taxes
Only available on the Mainland and in Hawaii.
Do you have children in day care? Are your out-of-pocket prescription drug costs increasing? Do your kids need braces? Does your elderly parent require a caregiver?
These expenses can add up. But with a reimbursement account, administered by PayFlex®, you can set aside pretax dollars and pay yourself back through a Health Care Reimbursement Account or a Dependent Care Assistance Plan.* Just be sure to make your 2023 elections during Annual Enrollment, November 1–22, 2022.
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Save on health care and dependent care costs
Your Costco benefits include two different reimbursement accounts, both administered by PayFlex:
Health Care Reimbursement Account (HCRA)
The HCRA allows you to reimburse yourself for health care costs your medical plan doesn’t cover. For example:
- Your medical plan deductible
- Out-of-pocket costs for medications
- Copays for doctors’ visits
- WeightWatchers membership
- Children’s braces
- LASIK surgery
Here’s a complete list of eligible HCRA expenses.
To enroll or re-enroll in a HCRA, you must make your annual election during Annual Enrollment. You can contribute between $120 and $3,050 per year. The money you elect will be taken out of your paycheck and deposited into your reimbursement account before payroll taxes are calculated.
You can then use the amount you set aside to reimburse eligible health care expenses incurred by you, your spouse and your eligible dependents. To be eligible for reimbursement, expenses must be incurred during the year in which you elect to participate.
After submitting your expense receipts through PayFlex, you’re paid back from your reimbursement account. You can access the full amount of your annual HCRA election on January 1, 2023.
Dependent Care Assistance Plan (DCAP)
The DCAP lets you set aside pretax dollars to reimburse yourself for eligible child (under age 13) and elder care expenses necessary for you and your spouse to work. Here are just a few examples:
- Licensed child care centers
- Nursery and preschools
- In-home care (au pair/nanny) and babysitting
- Elder/senior care during the day
Here’s a complete list of eligible DCAP expenses.
To enroll, or re-enroll, in a DCAP, you can either make your annual election during Annual Enrollment or when you experience a change in your dependents’ expenses during the year. You can contribute up to $5,000 per year ($2,500 per year if you’re married and filing separately) to a DCAP for work-related dependent care expenses. To be eligible for reimbursement, expenses must be incurred between January 1 of the year you elect to participate and March 15 of the following year. For example, if you elect a DCAP account for 2023, you would have until March 15, 2024 to incur eligible expenses.
The money you elect is taken out of your paycheck and deposited into your reimbursement account before payroll taxes are calculated. Since your payroll taxes are then based on a lower gross amount, the amount of taxes deducted from your paycheck is lower, too.
After submitting your expense receipts through PayFlex, you’re paid back from your reimbursement account. With DCAP, however, you can only access the amount currently in your account at the time of your reimbursement request, not the entire annual amount you elected.
Got money in a PayFlex account? Use it or lose it!
If you have a 2022:
You can carry over into 2023:
Health Care Reimbursement Account (HCRA)
A maximum of $570
Dependent Care Assistance Plan (DCAP)
$0
You have until April 30, 2023, to submit reimbursement claims for eligible expenses incurred between January 1 and December 31, 2022.
To enroll or re-enroll in an HCRA or a DCAP for 2023, visit Costcobenefits.com during Annual Enrollment, November 1–22, 2022. See the resources below for more information.