It was an interesting juxtaposition of tax issues last week at my other tax blog.
On one hand, a lot of folks apparently don't maximize their flexible spending accounts at work.
This tax saving option seems like a no-brainer, but if you check out the comments on the blog post, you'll find some good reasons why many workers aren't that enamored of the FSA workplace benefit.
Then there's the tax paying, not saving, side of the coin. When IRS bills are too big, some people opt for alternate payment methods, including installment plans. But the government watchdog agency that keeps an eye on the IRS found some problems with IRS payment plans.
You can check out new posts each Tuesday and Thursday at my Bankrate Taxes Blog. And if you happen to miss them there, check here on Saturday evening for the weekly round-up.
You also might find these items of interest:
Elliott
After my son was born in July, I wanted to increase my FSA election. I estimated my eligible and projected expenses for 2011 (about $1200) and then spoke to the FSA administrators. $200 of the expenses were going to require various combinations of Letters of Medical Necessity and prescriptions. Even then, reimbursement wasn’t guaranteed.
In the end, I increased my election by just $1000. For the hassle of saving $50 on my taxes (25% marginal tax bracket), it wasn’t worth the frustration, hours of paperwork & phone calls, and risk of losing extra$200.
Many of the rules make little sense. For example, vitamins require both Rx and LMN since some people use vitamins for general health. However, prenatal vitamins require neither an Rx nor LMN since they are for the medical condition of pregnancy.