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UNREIMBURSED MEDICAL (URM)
Most people incur out of pocket medical expenses during the year. Out of pocket expenses are those expenses that not covered by insurance or any other third party.
They include:
Deductibles
Co-Pays
Vision Care
Dental/Orthodontia Expenses
Medical
Over the Counter Drugs/Items
(Eligible Medical Expenses)
Unfortunately, very few can deduct them from their taxes at the end of the year. When filing your taxes you can only deduct those expenses that exceed 7.5% of your adjusted gross income. Therefore, the majority of taxpayers would not qualify. Through an Unreimbursed Medical account you are allowed to set aside tax free dollars to cover your out-of -pocket expenses.
How Does It Work?
First you must estimate you and your family members (spouse and dependents) out of pocket expenses that will incur during the plan year. Your estimate should be conservative. Monies not claimed by the end of the plan year would be forfeited.
You may set aside any amount up to your plan design limit. The amount you elect is divided by the number of deductions in the plan year. However, your annual election is available to you at any time during the plan year. For instance: If you elected $600.00 for the plan year and were paid monthly, (12 times) $50 a month would be deducted before taxes. . If you had an eligible expense of $600.00 the first month, you could claim entire amount even though it has not been deducted.
When you have incurred an eligible expense simply submit proof along with a Request for Reimbursement form. (Claim Procedures)
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