Flexible Spending Accounts (FSAs)

Learn about FSAs available to DoD NAF employees.

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Flexible Spending Accounts (FSAs)

Learn about FSAs available to DoD NAF employees.

FSAs can help you save on taxes and pay for eligible health care expenses.

A Flexible Spending Account (FSA) is a great way to pay for eligible expenses using money you set aside before taxes. You can set one up during Open Enrollment by telling your employer how much to deduct from your paycheck throughout the year. Because the money you contribute to an FSA is exempt from federal taxes, as well as most state and payroll taxes, you keep more of the money you earn. The money is automatically deducted from your paycheck and deposited into your FSA in equal amounts throughout the year.

Inspira Financial (formerly PayFlex) is the administrator of the FSAs available to DoD NAF employees. (The administrator was formerly WageWorks for Air Force NAF employees.)

Types of FSAs available

There are two ways most NAF employees can identify what plans are available: using ALEX, the interactive benefits counselor, or using the ZIP code tool. Learn more about these helpful comparison tools.

Health Care FSA

This account reimburses you for various eligible health care expenses. These include medical, dental, vision, hearing and prescription drug expenses. You can also use these funds for copays, deductibles, coinsurance and certain over-the-counter (OTC) items. Note: You’ll need a written prescription for OTC drugs and medicines to pay for them with the Health Care FSA.

Dependent Care FSA

This account reimburses you for certain child and adult care expenses. This applies if you and your spouse (if married) are working, looking for work or attending school full time and have kids under age 13 or take care of dependent adults. Such expenses include day care, nursery school, preschool, care before and after school, and summer day camp, as well as adult day care and elder care expenses.

Who is eligible for an FSA

U.S. and overseas NAF employees may be eligible for an FSA.
You may enroll in one or both types of FSAs at the same time (if eligible).
You don’t have to be enrolled in an employer-sponsored medical plan to enroll in an FSA.
U.S. employees enrolled in the HDHP with a Health Savings Account (HSA) may not also have a Health Care FSA.
You may enroll in both a Dependent Care FSA and an HSA.
You must enroll every year during Open Enrollment. Your current FSA election does not carry forward from year to year.
NAF retirees are not eligible for FSAs but can participate in an HSA or a Health Reimbursement Account (HRA), depending on their age. Learn more on the NAF retirees page.

How much you can contribute

There are annual maximum amounts or limits on how much you can put into an FSA each year.

For a Health Care FSA:

Army, Exchange, Marine Corps and NEXCOM: $3,200 each (for an individual and enrolled spouse)
CNIC: $3,200 each (for an individual and enrolled spouse)
Air Force: $2,850 (individual only) or $2,750 each (for an individual and enrolled spouse)

For a Dependent Care FSA:

All NAFs: $5,000 per household/family

If you and your spouse each have a Dependent Care FSA, you are limited to $5,000 between the two of you.

Note: These rates may be subject to change. For the most up-to-date information, consult your HR Office.

What is the FSA ‘use it or lose it’ rule?

Because FSAs have tax benefits, the IRS places guidelines on them. Usually, any funds left in your account at the end of the plan year are forfeited. This means you’ll want to choose wisely when deciding how much to contribute. However, in some cases there are exceptions.

For a Dependent Care FSA:

Dependent Care FSAs have a “use it or lose it” rule. This means that all funds in your account must be used by the deadline (determined by your employer) or they will be forfeited.

For a Health Care FSA:

Your NAF determines how much of the unused Health Care FSA funds in your account can be carried over into the following year. For some NAFs, there is a grace period in which to use the funds instead. These are the grace periods and carryover amounts for 2025:

Air Force: Grace period of 2.5 months, no carryover
Army, Exchange and Marine Corps: Up to $640 carryover
CNIC: Up to $610 carryover
NEXCOM: Ask your HR Office for details.

How to enroll in an FSA

First, review your expenses from this year and last year. Think about what you expect to spend in the year ahead. This will help you decide how much to contribute to a Health Care or Dependent Care FSA. After you decide how much (if any) to contribute, fill out an enrollment form. Find the form for your NAF in the resources and forms section below.

Learn more about FSAs

Visit InspiraFinancial.com and log in to your employee account to use the following tools: