Tax savings accounts: Know your options

Health Savings Account (HSA)

Only employees enrolled in the UC Health Savings Plan (HSP) are eligible to contribute to the HSA. You may not contribute to an HSA and participate in the Health Flexible Spending Account in the same tax year.

Health Flexible Spending Account (FSA)

Employees may not contribute to an HSA and participate in the Health Flexible Spending Account in the same tax year, so members of UC Health Savings Plan are not eligible. Otherwise, employees who are eligible for any level of UC faculty/staff benefits or the Postdoctoral Scholars Benefit Plan are eligible to enroll.

Limited Purpose Flexible Spending Account (LPFSA)

Employees who meet ALL of the following criteria are eligible:

• Eligible for the Faculty/Staff Benefits program
• Participated in the Health FSA during a plan year
• Have a carry-over balance greater than $25 at the end of that plan year
• Enrolled in the UC Health Savings Plan at the start of the following plan year

Dependent Care Flexible Spending Account (DepCare FSA)

Employees who are eligible for any level of UC Faculty/Staff benefits or the Postdoctoral Scholars Benefit Plan are eligible to enroll.

Health Savings Account (HSA)

Employees are automatically enrolled after enrolling in the UC Health Savings Plan and meeting the Customer Identification Program requirements.

Health Flexible Spending Account (FSA)

Employees can enroll during new hire enrollment, open enrollment and certain qualifying life events.

Limited Purpose Flexible Spending Account (LPFSA)

Employees are automatically enrolled if eligible.

Dependent Care Flexible Spending Account (DepCare FSA)

Employees can elect during new hire enrollment, open enrollment and certain qualifying life events.

Health Savings Account (HSA)

Contribution limit, including employer contribution:

• $4,150 (individual)
• $8,300 (individual + 1 or more)

Employer contribution: Up to $500 for an individual; up to $1,000 for an individual +1 or more; pro-rated for mid-year enrollments

Health Flexible Spending Account (FSA)

Contribution limit: $3,050

No employer contribution

Limited Purpose Flexible Spending Account (LPFSA)

N/A — no employer contribution; participants cannot contribute to this account

Dependent Care Flexible Spending Account (DepCare FSA)

No employer contribution

Contribution limits:

• $5,000 for employees who earned up to $150,000 in 2023
• $3,000 for employees who earned more than $150,000 in 2023

Health Savings Account (HSA)

The balance in your account can be claimed at any time.

Health Flexible Spending Account (FSA)

Your total annual election amount is available on day one of your participation and may be claimed until the plan year’s deadline.

Limited Purpose Flexible Spending Account (LPFSA)

The remaining balance of your prior year’s Health FSA is available in the first week of January, through the plan year’s deadline.

Dependent Care Flexible Spending Account (DepCare FSA)

The balance in your account may be claimed for eligible expenses until the deadline for the plan year.

Health Savings Account (HSA)

Funds can be used for eligible expenses for you, your spouse, and eligible tax dependents (see Publication 969  and the IRS website for definitions as they apply to the HSA).

Health Flexible Spending Account (FSA)

Funds can be used for eligible expenses for you, your spouse, and eligible tax dependents.

Limited Purpose Flexible Spending Account (LPFSA)

Funds can be used for eligible expenses for you, your spouse, and eligible tax dependents.

Dependent Care Flexible Spending Account (DepCare FSA)

Funds can be used for eligible expenses for your children under age 13 and eligible adult, tax dependents incapable of self-care

Health Savings Account (HSA)

Eligible unreimbursed medical, dental, and/or vision expenses as defined by IRC 213(d); refer to Publication 502. Generally, health insurance premiums do not qualify.

Health Flexible Spending Account (FSA)

Eligible unreimbursed medical, dental, and/or vision expenses as defined by IRC 213(d). Health insurance premiums do not qualify.

Limited Purpose Flexible Spending Account (LPFSA)

Eligible dental, vision, and certain preventive care medical expenses, as defined by the IRS.

Dependent Care Flexible Spending Account (DepCare FSA)

Expenses for dependent care, including child care, daycare, summer camp and eldercare for eligible dependent adults.

Note that medical expenses do not qualify for use with this account.

Health Savings Account (HSA)

Contributions are pretax and federal tax free when used for qualified medical expenses. California and a few other states do not recognize HSAs as tax-free.

Health Flexible Spending Account (FSA)

Contributions are pre-tax and tax-free when used for qualified medical expenses.

Limited Purpose Flexible Spending Account (LPFSA)

Contributions are pre-tax and tax-free when used for qualified medical expenses.

Dependent Care Flexible Spending Account (DepCare FSA)

Contributions are pre-tax and tax-free when used for qualified dependent care expenses.

Health Savings Account (HSA)

Unused funds roll over from year to year. There is no deadline to submit claims or request reimbursements

Health Flexible Spending Account (FSA)

You may carry over a minimum of $25 and a maximum of $640 in unused funds to the next plan year. You’ll lose any money under or over the carryover amount that you haven’t spent on eligible expenses by April 15, 2025. 

Limited Purpose Flexible Spending Account (LPFSA)

Any funds unclaimed by the end of the plan year will be forfeited.

Dependent Care Flexible Spending Account (DepCare FSA)

A grace period allows extra time beyond the end of the plan year to incur claims. For example, 2024 plan year participants have till March 15, 2025, to incur eligible expenses for reimbursement. Any funds unclaimed by the end of the grace period will be forfeited.

Health Savings Account (HSA)

You can invest any funds over $1,000 in your account — the same way you invest funds in retirement savings accounts, except interest accrues federal tax-free.

Health Flexible Spending Account (FSA)

No investment options.

Limited Purpose Flexible Spending Account (LPFSA)

No investment options.

Dependent Care Flexible Spending Account (DepCare FSA)

No investment options.

Health Savings Account (HSA)

The account is owned by the employee. Employees have access to any unused funds after leaving UC and during retirement. It can be bequeathed to a named beneficiary.

Health Flexible Spending Account (FSA)

Expenses incurred after the employee leaves UC or otherwise becomes ineligible for participation cannot be reimbursed. However, employees are eligible to continue Health FSA coverage through COBRA if they have unspent funds in their account at the time of the qualifying event (such as termination of employment). Funds not claimed by the plan year’s deadline are forfeited.

Limited Purpose Flexible Spending Account (LPFSA)

Expenses incurred after the employee leaves UC or otherwise becomes ineligible for participation cannot be reimbursed. Funds not claimed by the plan year’s deadline are forfeited. LPFSA is not eligible for COBRA continuation.

Dependent Care Flexible Spending Account (DepCare FSA)

Expenses incurred after the employee leaves UC or otherwise becomes ineligible for participation cannot be reimbursed. Funds not claimed by the deadline for the plan year are forfeited. DepCare is not eligible for COBRA continuation.