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Flexible Benefits

A flexible benefits program is designed to help employees reduce their taxes. Authorized under Section 125 of the Internal Revenue Code, this program allows eligible employees to pay certain expenses from pre-tax rather than after-tax income.

State employees covered under the State Plan are eligible to participate in the State-sponsored flexible benefits program. The program is offered by the Department of Treasury. (Note: Higher education employees are not eligible for this plan because they have their own flexible benefits program. In addition, employees covered under the Local Education and Local Government Plans, though not eligible for this program, may be offered a different flexible benefits program by their employer.)

Any premiums you pay for State group health or dental insurance are automatically paid with tax-free earnings through the State-sponsored flexible benefits program. In addition, you can choose to set aside pre-tax dollars to pay eligible medical expenses or dependent day care expenses through the program’s:

You’ll find complete details about the flexible benefits program through the Department of Treasury website.

If you have questions about the program, contact:

Telephone: 1-615-741-3131
Fax: 1-615-401-6815
Email: flexible.benefits@tn.gov

Contributing to a Flexible Benefits Reimbursement Account

The Medical Expense Reimbursement Account and Dependent Day Care Reimbursement Account are separate accounts; you can contribute to one account only or to both accounts, depending on your needs.

Your contributions are deducted in equal installments from your pay on a pre-tax basis. To help with your planning, the Department of Treasury website provides worksheets for estimating your annual eligible health and dependent day care expenses.

See the flexible benefits program expense worksheets »

In order to pay medical expenses or dependent day care expenses through the State-sponsored flexible benefits program, you must file an election form each year during the Annual Enrollment Transfer Period. Elections filed for previous years do not continue automatically. Election forms should be turned in to your departmental personnel officer before your annual enrollment deadline.

The election form is available through the Department of Treasury website.

Get the election form »

Flexible Benefits Reimbursement Account Features

 

 

 Medical Expense
Reimbursement Account		 Dependent Day Care
Reimbursement Account

Purpose

Use the account to reimburse yourself for eligible medical, dental and vision care expenses

Use the account to reimburse yourself for eligible dependent day care expenses

Maximum Annual Pre-Tax Contribution

$7,500

$5,000—If you file your income taxes as “head of household,” “single” or “married, filing jointly”

$2,500—If you are married but file a separate federal income tax return

Examples of Eligible Expenses
  • Back supports
  • Braille books and magazines
  • Contact lenses and solutions
  • Co-pays/co-insurance
  • Detoxification or drug abuse treatment centers
  • Eye exams, lenses and frames
  • Hearing exams and hearing aids
  • Infertility treatment
  • For 2011, over-the-counter medications you take to treat a medical condition, such as cold or allergy medications, antacids and pain relievers, are eligible with a doctor's prescription
  • Smoking cessation programs prescribed by a doctor to treat a specific illness
  • Unreimbursed dental and vision care expenses
  • Day care services provided inside or outside your home for eligible dependents under the age of 13. Services must be for the physical care of the child and must not be provided by a spouse or dependent.
  • Day care services provided for a dependent adult or child who is mentally or physically incapable of self care. To be eligible, services may not be provided by a spouse or dependent and the eligible dependent must regularly spend at least eight hours per day in your household.

 

Refer to the Department of Treasury website for a more complete list of eligible and ineligible expenses.